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CGTS OPTIONS CORNER FOR MONDAY, 7 FEB 2011. BUY CALLS ON EWM, RIMM, GOOG. TAKE PROFITS ON SSL (GAIN OF 233%) AND ROK (GAIN OF 137%)

|Includes:BlackBerry Ltd. (BBRY), EWM, GOOG, ROK, SSL

OPTIONS CORNER
Short-Term Trading in Options.
7 February 2011, Monday
 
 
Our weekend report finds us up 43% in our options trades since December 20 2010.  We like EWM, Malaysian Index ETF, RIMM, Research-in-Motion, and Google calls short to intermediate term (Feb and March expirations).

Indexes are NOT pulling back at this point.
 
********************************
 
Our options trades since 20 December 2010 are up just about 43%.
 
Our pick for tonight: Long UAL, UNITED/CONTINENTAL HOLDINGS.  We're buying March 25 calls.
 
OPTIONS TRADING SCORECARD:

CGTS OPTION  PORTFOLIO (Since 12/20/10)        Active
% Gain    1/24/11    Profit    Trades
43.43%    Option Trades    $647,108    149
DAILY TRADES PLUS       
33.19%    MJCF Close Medium 2    $86,294    26
29.83%    MJC CM Simple Sum 2    $41,761    14
45.08%    MJC M53 Simple 2/11    $22,541    5
61.22%    MJC Char Meter Diff Tr 1/11b    $110,197    18
18.78%    MJC M2F M53 Combo    $24,419    13
56.56%    M2F 14% Trade    $147,054    26
288.44%    M2F AVG ALT DIFF ASP    $115,375    4
49.05%    M4 ACCUM 00 14 2    $93,188    19
5.40%    M5 3 ASP LT 2a    $16,193    30
38.16%    M5 3 Avg Diff ASP Sum    $38,157    10
38.22%    M5 3 Test Double Combo    $38,223    10


 NEW SALES

M2FALT/M5 3 Combo. Bought: SSL Feb 50 calls @ .75 1/28/11.  SOLD: 2/4/11 @ 2.5.  Gain 233% 
Click to enlarge

M5 3 Double Combo. Bought: ROK Feb 70 calls @ 5.4 1/21/11.  SOLD 2/4/11 @ 12.8.  Gain 137%.  

Click to enlarge

 
NEW PURCHASES
 
Best chart of all our buy signals today: EWM, Malaysian Index ETF.  Getting buy signals on this one from several of our trading systems.
 
 Click to enlarge

We also like Google here.  Some things to notice about the chart: M5 3 Momentum (top chart, red-brown line) has worked its way lower without much selling.  This is a positive.  M2F Momentum (black line, pane 2) is overbought a bit.  This suggests our first couple days in this trade might be down, as GOOG works off its overbought condition.  M4 Sum Plus 21 Rev (third down, black line): selling has taken the indicator down to zero but NOT through zero.  This is a positive.  M4 Accum (14): is at -10 and flattening -- this should mean it is bottoming.  T5 Simple Sum, bottom pane, is also reaching a bottom point: positive.
 
Click to enlarge
 
RIMM, Research-in-Motion.  Looks like we'll have a continued rally in RIMM here.  We think 70 is possible during the next leg up.  Note: M2F ALT is overbought here also.  This is not a negative necessarily.  M5 3 is NOT overbought yet (see red line, top pane).  See how T5 (short-term trade), red line, bottom pane, is making higher highs and higher lows -- this suggests the trend is still intact.
 
 Click to enlarge
 
 BUY AND SHORTSELL SIGNALS

Here is a complete list of today's buy and shortsell signals, with option trades we like.  Issues with ** don't trade options.  Some issues do not look good here because of too much appreciation already, such as SSL.  Others just don't look very good at the moment and we've avoided them. Issues marked with '<--' we like alot.

MJCFLASH 4-Feb    
REMX MJCF Close Medium 2 24.622 LONG
REMX FEB 22.5 calls 2.372 LONG
CDNS MJCF Close Medium 2 9.49 LONG
CDNS Feb 7.5 calls 2.24 LONG
CSUN MJCF Close Medium 2 4.53 LONG
CSUN Feb 2.5 calls 2.28 LONG
FMCC MJCF Close Medium 2 0.73 LONG
MTL MJCF Close Medium 2 33.49 LONG
MTL Feb 34 calls 0.7 LONG
PBTH MJCF Close Medium 2 5.88 LONG
PBTH ** MJCF Close Medium 2 5.88 LONG
RIMM MJCF Close Medium 2 63.69 LONG
RIMM Feb 65 calls 0.89 LONG
TAN MJCF Close Medium 2 8.3 LONG
TAN FEB 8 CALLS 0.4 LONG
       
ITMN MJC CM Simple Sum 2 36.91 LONG
ITMN FEB 35 CALLS 2.84 LONG
MSI MJC CM Simple Sum 2 39.31 LONG
SAH MJC CM Simple Sum 2 13.33 LONG
SAH FEB 12.5 CALLS 1.08 LONG
VZ MJC CM Simple Sum 2 36.31 LONG
VZ FEB 35 CALLS 1.56 LONG
X <- MJC CM Simple Sum 2 58.17 LONG
X FEB 57.5 CALLS 1 LONG
       
ICON MJC M2F M53 Combo 19.5725 LONG
ICON FEB 20 CALLS 0.4 LONG
       
REMX MJC Char Meter Diff Tr 1/11b 24.622 LONG
REMX FEB 22.5 CALLS ı 2.375 LONG
PTP MJC Char Meter Diff Tr 1/11b 45.3 LONG
PTP FEB 45 CALLS 0.55 LONG
SSL MJC Char Meter Diff Tr 1/11b 52.32 LONG
       
XHB MJC M53 Simple 2/11 17.375 LONG
XHB FEB 16 CALLS 1.988 LONG
       
TEVA M2F 14% Trade 54.1 LONG
TEVA March 52.5 calls 2.61 LONG
CSUN M2F 14% Trade 4.53 LONG
CSUN March 2.5 calls M2F 14% Trade 2.28 LONG
BLK M2F 14% Trade 194.35 LONG
BLK March 195 calls 7.68 LONG
HGX M2F 14% Trade 114.87 LONG
HGX Feb 114 calls M2F 14% Trade 2.55 LONG
       
XHB M4 ACCUM 00 14 2 17.7375 LONG
XHB Feb 16 calls 1.988 LONG
SSL M4 ACCUM 00 14 2 52.32 LONG
NILE M4 ACCUM 00 14 2 61.06 LONG
NILE FEB 55 calls 6.31 LONG
MSFT M4 ACCUM 00 14 2 27.77 LONG
MSFT FEB 27 calls 1.02 LONG
IGT M4 ACCUM 00 14 2 17.51 LONG
IGT MARCH 17 calls 1 LONG
ICON M4 ACCUM 00 14 2 19.5725 LONG
ICON FEB 20 calls 0.4 LONG
HOV M4 ACCUM 00 14 2 4.26 LONG
GOOG M4 ACCUM 00 14 2 610.98 LONG
GOOG MARCH 610 calls 17.7 LONG
EWM <-- M4 ACCUM 00 14 2 14.5425 LONG
EWM April 14 calls 0.792 LONG
CPA M4 ACCUM 00 14 2 56.97 LONG
CPAFEB 55 calls 2.9 LONG
BA M4 ACCUM 00 14 2 71.38 LONG
BA March 70 calls 2.75 LONG
AKAM M4 ACCUM 00 14 2 47.88 LONG
AKAM May 47 calls 1.13 LONG
       
WBD M5 3 Avg Diff ASP Sum (NYSE:W) 32.87 LONG
WBD FEB 30 CALLS 3.12 LONG
MSFT M5 3 Avg Diff ASP Sum (W) 27.77 LONG
MSFT FEB 27 CALLS 1.02 LONG
AXP M5 3 Avg Diff ASP Sum (W) 43.82 LONG
AXP FEB 40 CALLS 4.07 LONG
ICON M5 3 Avg Diff ASP Sum (W) 19.5725 LONG
ICON FEB20 CALLS 0.4 LONG
       
EWM M5 3 Test Double Combo 14.5425 LONG
EWM APRIL 14 CALLS M5 3 Test Double Combo 0.792 LONG
EL M5 3 Test Double Combo 93 LONG
N225 M5 3 Test Double Combo 10543.52 LONG
HK M5 3 Test Double Combo 20.68 LONG
HK MARCH 18 CALLS 2.93 LONG
PDE M5 3 Test Double Combo 34.39 LONG
PDE MARCH 34 CALLS 1.8 LONG
RSX M5 3 Test Double Combo 40.12 LONG
RSX FEB 40 CALLS 0.37 LONG
KSU M5 3 Test Double Combo 51.11 LONG
KSU FEB 48 CALLS ı 3.36 LONG
SCC ** M5 3 Test Double Combo 20.59 SHORT
Click to enlarge

 
 
A Disclaimer of sorts:
 
I will update these positions regularly, so we can all see how we are doing with our short-term speculating.
 
I am bullish on gold long-term (until Bernanke is fired, and more generally until about 2019, the end of the deflation cycle) -- and I'm relatively bullish on stocks until QE is abandoned.  QE does many things, one of which is to try to make sure that stocks and bonds don't decline.  The Fed, quite likely, has guaranteed to bankers the advance of stock prices.  As long as the Fed is willing and is allowed to backstop stock prices, short positions are very dangerous, except in isolated cases.  Bond vigilantes are showing Mr. Benanke that his designs may not be able to proceed without resistance however.  Rising rates are a slap in the face of American power; the slap is welcomed by those of us who think debt is the problem that needs to be addressed, destroyed, rather than expanded and extended.
 
Trading options is highly speculative and can be dangerous.  Pricing of options is never very clear; buying options is almost always less prefereable than selling options, in terms of likely profits.  But buying options gives an investor a HUGE BANG FOR THE BUCK.  Getting accurate price data on options (especially those thinly-traded) is also often a problem, with which we'll have to work.  Typically we work with the last close, if it falls between bid and offer.  If it does not, then we average the bid/offer.
 
If one knows what direction a stock is moving, short-term options can be profitable.  The problem with options, of course, is that they, like ourselves, decay with time.
 
The cheaper options expire more quickly (one can always buy long-term options is one wishes to speculate on long-term stock or market moves).  I like short-term expirations, cheap options, and getting in and out (with profits).
 
I have many short-term trading systems.  I will use several in this Options Corner.  The first I start with I call "M5 3 Chart Trade" which really relies on the M5 3 Momentum Indicator to trigger the trade, always in the same direction of the major trends.
 
Successful trading!  We know the game is fixed; but let's ride on the back of the dragon for as long as we can.
 
More information on the CGTS systems can be found at:
home.mindspring.com/~mclark7/CGTS09.htm
 
MICHAEL J CLARK
Clark's Gate Timing System
Hanoi, Vietnam
84 4 221 92210
 
Long AHGP Feb 50 calls.
 
 
 
 
 
 
  
Stocks: BBRY, GOOG, EWM, SSL, ROK