Options Investing Strategies – Market Strategies Newsletter – December 12, 2011

Market Strategies

Options trading Strategies

 

 

 

Covering High Return Balanced Investing Success Strategies For

Stocks ■ Bonds ■ Interest Rates ■ Natural Resources ■ Currencies ■ Venture Capital ■ Gold

 

A Publication of Princeton Research, Inc. (www.PrincetonResearch.com)

Contributing Staff: Michael King, Bill Chippas, Charles Moskowitz

 

 December 12, 2011

Market Strategies Guide to Successful Trading

 

Read PDF Market Investing Strategies Newsletter PDF Version – CLICK HERE

 

Special Note:  Charles Moskowitz appeared for an interview at StockLegends.com. http://www.stocklegends.com , we urge everyone to listen to the interview now available on our website at

http://www.princetonresearch.com/princeton-research-featured-on-investment-news-show/

 

 

We have been asked to help those who do not wish to make a $100,000 commitment to an account to scale back the initial investment to a $10,000 account. 

We are answering this request with an account that will only trade options.  However, in order to take full advantage to this new account, you really need to also subscribe to our Texting service.  There is no cost involved, but in order to receive all of the trading suggestions, in a high volatility environment, we need to communicate more often than weekly.

To subscribe, simply TEXT the word UPDATES to 69302

and you will automatically be included.

 

$10,000 OPTIONS ONLY ACCT:

New Trades for this week:
BUY 10 RMBS JANUARY 7.50 CALLS @ $ .63 OB   
BUY 5 MHS JANUARY 60 CALLS @ $1.60 OB
BUY 2 BLK JANUARY 180 CALLS @ $4.00 OB
BUY 5 TEN JANUARY 29 CALLS @ $2.10 OB
BUY 3 TLT JANUARY 114 PUTS @ $2.25 OB

 

The $10,000 Options Only account made $860 last week, its twenty eighth week of trading. We came into the week with a balance of $8,389.00 and with the profits last week increased the gains to $9,249.00.  Four positions remain: the RIMM Jan 17.50 Calls, CONN Jan 12.50 Calls, QCOR Jan 44 Calls and ZSL Jan 14 Calls. The Open positions are highlighted in the options table below. 
Approximately $ 4060 funds are in use.  If the new positions are filled another $ 3955 will be employed for a total of $8015.

We seem to be at a crucial point this week….There are many more charts that look like they can take-off higher.  Without sounding like I’m hedging, that also means we are at an area that we could initiate shorts with limited risk, BUT in the $100M account we are long from lower levels and a failure here just means we take profits.  European problems seem to have receded a bit, but there is still plenty to worry about…Iran / Iraq can easily take its place as a source of troubling overnight news.  We are overall bullish but will continue to maintain a balanced stance until we see things unfold…CAM

 

Remember, these trades are based on your participation in the TEXTING SERVICE TO RECEIVE ALL UPDATES. Previous closed out trades not  listed here may be seen in the December 5, November 28, November 21, November 7, October 17, October 3rd, August 22nd, August 8th, July 25th, July 18th and July 5, 2011 letters.

 

 

DATE

TRADE

PRICE

COST

PROCEEDS

RESULTS

12/9

Bought 10 ZSL January  14 Calls

.90

900

 

 

12/9

Sold 50 WFR Jan 5 Calls

.22

 

1100

250

12/7

Sold 10 QQQ 12 /57 Puts

1.35

 

1350

210

12/6

Bought 4 QCOR January 44 Calls

2.90

1160

 

 

12/6

Bought 10 CONN January 12.50 Calls

1.10

1100

 

 

12/6

Bought 50 WFR Jan 5 Calls

.17

850

 

 

12/5

Bought 10 QQQ  12/57 Puts

1.14

1140

 

 

12/5

Sold 50 BAC December 6 Calls

.22

 

1100

400

12/2

Bought 5 RIMM January 17.5 Calls

1.80

900

 

 

12/1

Bought 50  BAC December 6 Calls

.14

700

 

 

New trades $ 10,000 account…In Texting we have a limited amount of words. In the interest of brevity: OPTIONS ONLY: 12 December; 1 January; 2 February
The Quantity and Strike Price for each trade is specific. For any questions please call 702 650 3000

MArket Laboratory – Weekly Changes

Prices are copied from Barron’s Weekly and Yahoo Finance and may be incorrect

Dow

12,184.26

+164.84

+1.37%

Nasdaq

2646.85

+19.92

+0.76%

S&P 500

1255.19

+10.91

+0.88%

Transportation

4957.02

+10.35

+0.21%

Russell 2000

745.40

+10.38

+1.41%

Nasdaq 100

2318.68

+16.64

+0.72%

Gold

1716.80

 -34.50

-1.97%

Silver

3225.3

-43.3

   -1.32%

Crude

99.41

+1.55

-1.54%

Heating Oil

291.25

-7.75

-2.59%

Unleaded Gas

2.5961

-0.0201

-0.77%

Natural Gas

3.317
-0.267              -7.45%

VIX

26.38

-1.14

-4.14%

Put/Call Ratios

S&P 100

158/100’s

+24/100’s

   Put/Call Ratios

    CBOE Equity

       77/100’s

     +16/100’s

 

Bonds

141-05 -0-21

3.10% +0.06%

10 Yr Note

129-27 +0-056                                                   2.05% +0.08%

Copper

355.75

-2.70

-0.75%

CRB Inflation

Index

306.55

-7.12

-2.27%

Barron’s Confidence

69.3.%

-1.3%

S&P100

568.17

+6.32

+1.12%

5 Yr Note

123-01 +0-078

.88% -0.04%

 

Dollar

78.68

        -.05

-0.01%

DJ Utilities

446.93

+3.30

+0.74%

AAII

Confidence

Index

Bullish

38.6

+5.6%

Bearish

34.8

-4.6%

Neutral

26.7%

-0.8 %

 

M1 Money Supply

+16.6%Nov 28th

 

M-2 Money.

Supply

+9.2%Nov 28th

 

 

M1…all money in hands of the public, Time Deposits Traveler’s Checks, Demand Deposits

M2 adds Savings and Money market Accounts both compared with the previous year.

New Stock Recommendations

 

BUY 2500 GMXR @ $1.60 OR BETTER

BUY 2500 AEZS @ $1.65 OR BETTER
BUY 200 STMP @ MKT TO COVER SHORT

Last Week Bought WFR, RICK and Shorted STMP.
We also Sold HWD and USPR all with text alerts.

 (A full position is $5,000)

 

 Each stock is allocated a theoretical $ 5,000 share of the portfolio unless otherwise indicated.

Stock

Purchase Price

Purchase Date

Stop/Loss

 

Price/Date Sold

 

Profit/(Loss)

WFR 1200

4.12

12/6/11

 

 

 

STMP 200

25.66

12/5/11

28.35

 

 

RICK 600

7.78

12/5/11

 

 

 

HWD 500

10.33

11/28/11

9.49sco

11.574 12/5

$622

CBOE 100

26.37

11/28/11

24.98sco

 

 

USPR *
20,000

.13
half pos.

11/09/11

 

.181 12/09

$1020

CONN 500

8.50

10/25/11

7.49X

 

 

SDS 100

25.55

10/5/11

 

 

 

XBOR*

1.40

8/12/11

0.70sco

 

 

LEI*

2.06

8/10/11

1.03x

 

 

KAJMY

30.45

3/21/11

29.60 sco

 

 

LEOM*

0.30

12/17/10

0.03 sco

 

 

 

 

 

Previous closed out positions can be found in the November 28, November 21, November 7, October 17, October 3, September 19, September 6th, August 15th, August 8th, August 1st and July 18th letters.

Model Portfolio Comments/Changes:

 

                                  INDEX OPTION RECOMMENDATIONS


For those of you who do not buy puts to protect your portfolio, there are many ETF’s that are the inverse of the DOW. The symbols are DOG and SDS, whichgo up when the DOW and S&P 500 go down and down when they go up.

 

New Stock Option Recommendations

 

BUY 20 RMBS JANUARY 7.50 CALLS @ $ .63 OB   
BUY 10 MHS JANUARY 60 CALLS @ $1.60 OB
BUY 5 BLK JANUARY 180 CALLS @ $4.00 OB
BUY 10 TEN JANUARY 29 CALLS @ $2.10 OB
BUY 6 TLT JANUARY 114 PUTS @ $2.25 OB

 

 

 

Option and overall Comments

We had a gain last week of $3217 in an up week.  Our gains for the year were $ 59,301 and with last week’s gains are increased to $62,518. We have six long options positions remaining, the ZSL Calls, CONN Calls, QCOR Calls, RIMM Calls, SDS Calls, UUP Calls (a US Dollar ETF) and the CSCO Spread . The stock table includes Nine long stock positions: WFR, RICK, CBOE, CONN, LEI, KAJMY, LEOM, SDS, XBOR and one short stock STMP. The SDS is a double inverse SP500 ETF.

 

The options call for a $ 2,500 investment unless otherwise started, while each stock position requires $ 5,000 unless specifically stated.

We are basing money management on a hypothetical $ 100,000.00 and are using $15,000 in the options positions and $ 45,000 in the nine long stock and one short stock positions for a total of

$ 60,000 with $ 40,000 in cash. This is our 46th letter for 2011. These figures are approximate.
We do not count commission costs and there may be errors. If the suggested stocks and options are executed another $16,500 would be in use.

Executions that have occurred at or near the open or close of trading sometimes vary from our actual numbers.  For example, when something opens down and it is through our price, we take the next trade whether it is an uptick or continues lower.  This sometimes results in a 50% trade that is slightly above or below the exact number…

Previous Week’s Recommendations and Rules for the $ 100,000 account

  • Text UPDATES to 69302.
  • All options count for about $ 2,500.00 for model portfolio calculations unless otherwise stated.
  • When the option has doubled sell half the position.
  • Stop Loss protection is either half or offered with each trade.
  • The cost of the option is the asking price (or the price between the bid and ask, whichever is more realistic)

at the close the previous Friday or at the open on Monday.

  • The options will be followed until closed out.
  • Option Symbols have changed. We will now use a new terminology. ( stock symbol with expiration month and strike price )
  • Subscribers can follow us on Twitter or call  702 650 3000 for up to date information.

Option

          COST

Date

Sold

 

Date

Profit/(Loss)

ZSL Jan 14
25 Lots
Calls              .90

12/9/11

 

 

 

 

OCOR Jan  44

10 lots

Call               2.90

12/6/11

 

 

 

 

WFR Jan 5

50 Lots

Calls               .17

12/6/11

.22

 

12/9/11

$ 250

CONN Jan 12.5  25 Lots Calls             1.10  

12//5

 

 

 

 

QQQ Dec 57
25 Lots
Puts              1.14

12/5/11

1.35

 

12/7/11

$ 525

RIMM Jan 17.5,  15 Lots Calls             1.80

12/2/11

 

 

 

 

BAC Dec 6
100 Lots
Calls               .14

12/1/11

.22

 

12/6/11

$ 800

SDS  Jan 20
15 Lots
Calls             1.71

11/30/11

 

 

 

 

 UUP Jan 22
20 Lots
Calls               .65

11/25/11

 

 

 

 

CSCO Jan 20 2012 Put short; longJan20;2013 Call Put/Call Spread  0.07

2/14/11

 

   

 

             

 

Note: Previous closed out stock and option positions can be found in the December 5, November  28, November 21, November 7, October 17, October 3, September 19, September 6, August 22, August 8, August 1, July 18, July 11, July 5, June 20, May 16, April 25, April 11,  March 21, March 14, March 7, February 21, 2011 February 7, 2011 January 24, 2011, December 20,2010, November 22, 2010, October 11, 2010, September 13, 2010, July 26, 2010, June 14, 2010, May 10, 2010, January 25, 2010, November 23, October 23, August 24, July 20, 2009 newsletters.

                                         

                            

                                  This Weeks’ Economic Numbers and Media Data

 

Monday 14:00 hrs Treasury Budget for November ( – 139.0B vs -150.0B )

3-Yr $ 32 Billion Note Auction takes place.

Tuesday 08:30 hrs Nov Retail Trade ( 0.6% vs 0.5% )

                Ex-Auto ( 0.5% vs 0.6% )

10:00 hrs Business Inventories October ( 0.9% vs 0.0% )

14:15 hrs FOMC Rate Decision ( 0.25% vs 0.25% )

Wednesday 07:00 hrs MBA Mortgage Index 12/10 ( NA vs 12.8% )

08:30 hrs Export Prices ex-Ag ( NA vs -1.5% )

                Import Prices  ex-oil ( NA vs -0.2% )

10:30 hrs Crude Inventories 12/10 ( NA vs +1.336 mln bbls )

 Opec meets in Vienna

Thursday 08:30 hrs Initial Claims 12/10 ( 385K vs 381K )

                Continuing Claims 12/03 ( 3625K vs 3583K )

08:30 hrs PPI Nov ( 0.2% vs -0.3% )

                CORE ( 0.1% vs 0.0% )

08:30 hrs Empire State Manufacturing Dec ( 3.0% vs -0.61% )

08:30 hrs Q3 Current Account Deficit ( -$ 110.0B vs – $ 118.0B )

09:00 hrs Net Long term TIC Flows ( NA vs $ 68.6B )

09:15 hrs Industrial Production Nov ( 0.2% vs 0.7% )

                Cap Utilization Nov ( 77.8% vs Same )

10:00 hrs Phila Fed Dec ( 4.3 vs 3.60 )

 Friday

 

08:30 hrs CPI Nov ( 0.1% vs -0.1% )

                CORE   ( 0.1% vs -0.1% )

 

Economic Data

 

The ISM Index came in a little short of expectations at 52.0 from 52.9 in October. The Unemployment Claims were surprisingly lowered to 381K; But all that news was unnoticed with the importance of Europe taking center stage.

 

 

Fundamentals ( previous letters may be seen at www.princetonresearch.com)

 

S&P put both Germany and France on “credit watch negative” while also placing all seventeen Euro Nations on a downgrade watch. This spilled some cold water on the positive news that the ECB intends to inject one trillion Euros for use in additional bond buying. The negativity, which caused a huge decline Thursday,  was that the vote was not unanimous and the ECB became more cautious in its economic outlook. It was also announced that capital shortfalls increased in their latest stress tests. Then on Friday a positive spin came on the belief that weaker Euro members that need to rely on a cheaper currency would be deleted if they don’t adhere to administered criteria.

By the end of a tumultuous week in volatility, both the Dollar and Euro had almost no change and the equity markets were relieved that the dollar had little upward momentum.

 

Nine of the ten Dow Industrial groups were higher on the week led by Financials, plus 1.59% followed by Technology, up 1.28% and Industrials gaining just 0.78%. Oil and Gas was up just 0.12%, while Basic Materials fell 0.52% for the week as the lone loser.

 

 

 

Technical Information

 

      Support Levels:   S&P 500         1253; 1232                     Resistance S&P 500     1274; 1289

                                        DOW           12,175 11,920                Resistance DOW        12,320; 12,530

                                        QQQ            5640; 5577                    Resistance QQQ           5729; 5805                     

                                        Nasdaq        2612; 2552                     Resistance Nasdaq      2672; 2758

                      
                              CYCLES

 

Only twice since 1850 in America have 30-year bond returns been as close to equity returns as they are today. And both times multi-decade bond-bear markets followed. During these periods the stock market jumped as much as 7-fold.” – Oxford Club newsletter, 11/12/11

 

 

Rule 17B requires disclosure of payment for investor relations*

 

Princeton Research has received about $ 2,500 per month from Lucas ( LEI ) marked with an asterisk.    Princeton has been paid for investor relations in the past and has negotiated a contract to be paid 100,000 restricted shares from Leo Motors. Princeton is paid by Baron Energy ( BROE ) to do investor relations in the amount of 300,000 shares. Princeton has also bought separate shares about 327,600 and owns the shares for its own account. USPR paid us 200,000 restricted shares. Cross Border paid us 25,000 restricted shares and we bought and own another 25,000 purchased at higher prices.

 

CONTACT

 

Please Direct All Inquiries To:

 

Mike King

Princeton Research

3887 Pacific Street, Las Vegas, Nevada 89121

 

Phone: (702) 650-3000

Fax: (702) 697-8944

mike@princetonresearch.com

Visit: www.princetonresearch.com

 

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