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Robert Edwards
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Contrarian daytrading technician who specializes in locating high probability short term trades while predicting price movement directions with over 85% accuracy. Most of my trading involves either extremely short term micro scalping of stocks or commodities (using 1 minute bar charts), or swing... More
  • Robert Edwards: Long April Lean Hogs And Other Trades For February 26, 2013 0 comments
    Feb 25, 2013 9:58 PM | about stocks: AAPL, COW, DUST, PBR, NUAN

    Before covering my meat trading positions, I will first cover stocks.

    APPLE (NASDAQ:AAPL) After no less than 7 straight down days, on Friday, 2/22 Apple finally had an up day, closing up 4.75 at 450.81. But the downtrend continued on Monday, 2/25 when Apple had an engulfing red candle, closing down 8.01. On Wednesday, 2/27, the annual meeting occurs. I am hopeful the company announces a buyback program prior to the market opening on that date. Doubling the dividend would also be nice. If we get neither, maybe a product announcement provides a bullish surprise....anything to get this pig out of the mud. I should have stayed in January 2014 calls instead of switching to March 2013 Monthly calls, as time is running out. I underestimated the bearish sentiment related to this stock. I won't make this mistake again. Regardless, I remain adamant in my bullish resolve and am prepared to reload with January 2014 calls on further weakness.

    PETROBRAS (NYSEARCA:PBS) Failed to take the quick profits I had when I sold 16 strike puts expiring 2/22 and 3/16. Closing under 16 on 2/22, put me long PBR. On 2/25 we closed 14.91. I will wait and sell calls against my long position on strength. I consider the selloff absurdly overdone and will sell more puts with lower strikes.

    NUANCE COMMUNICATIONS (NASDAQ:NUAN) On pop above 19 on 2/25, sold out my lower priced shares. Will continue adding on weakness at 18.50 and lower which I consider real value. Close of 18.39 on 2/25.

    Short DUST Sept Calls - Naked call selling position looks much better with the rally in gold and gold stocks (NYSEARCA:GDX) on 2/22, and related retracement in DUST. Near break-even.

    Short June 118 Cattle Puts - With bottoming type action in Live Cattle, puts looking fine for now. Will continue to hold with expectation the puts never go "in the money" and expire worthless.

    Long April Lean Hog Futures - With the drought worries abating, expect feed prices (corn) to drop, encouraging build up of herds. Exports should remain near record levels in 2013. Bought April Lean Hogs at 82.00 prior to the bullish 2/22 cattle on feed report, and the slightly bullish pork cold storage report. When we got the surprise lower opening on 2/25, added to my long position. Was happy we rallied, filling the gap and closing up on 2/15 for the first up day after 8 straight down days. Am hopeful this is a reversal that can cause at least a $2 rally back to 84.00. I do not believe we should trade lower than 78.00 in April Lean Hogs in any case, and am hopeful we are very near a low when we bottomed just under 81.00 on 2/25. Extremely oversold condition causes me to want to buy dips and scalp from the long side in this market. I trade lean hogs better than any other futures market and am excited that we have sold off to these low levels.

    Disclosure: I am long AAPL, NUAN, PBR.

    Additional disclosure: I am also long Aapl March 2013 calls.

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