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Robert Edwards: Trading Update For March 8, 2013

|Includes:Apple Inc. (AAPL), CLF, DUST, PBR

Petrobras (NYSE:PBR) - I just posted an article about my latest best trading idea---being long Petrobras (PBR). In early February, I began selling 16 strike puts on a weekly basis for income. This worked for a couple weeks but the third week I was put the shares when the stock closed in the low 15s. It took the mid 14s to bottom the stock but the last couple days the stock has been on fire, following a positive news development. In two days the stock moved from 14.49 to 18.05. I feel the stock should hit 19.50 shortly.

Apple (NASDAQ:AAPL) - This stock defies logic and remains in the doldrums. I don't know what will wake this stock up, but if it does not pop by March 15, 2013, then my March calls will go off worthless. Fortunately I was able to successfully day trade many April calls and I was able to average down and not show any April call losses. Beginning today, I have begun day trading 500 strike May 2013 calls in Apple. I am hopeful that even if we don't rally, most of the down move is done for awhile and call trading will not be that challenging going forward. I may choose to move to June or later month calls if the current support at 420 breaks down.

Long April Lean Hogs (HEJ13) - I posted an instablog on February 28, 2013, explaining that I felt Hogs should bottom soon. I have been trading them from the long side from the 81 cent area down to this week's low just above 78 cents, buying on 50 cent dips and selling some during small daily rallies. Today we closed strongly, near the 82 cent level, so maybe this market has indeed bottomed for now. I will continue to play this market from the long side. I was short June Live Cattle 118 puts and have taken small profits recently and will stick with trading hogs for now.

Short DUST Sept. 60 strike calls - I am short calls in the triple Bearish Gold Stock ETF (NYSEARCA:DUST) and have been buying the stock during the day against my calls to make day trades and to protect the calls in case the gold stock index (NYSEARCA:GDX) continues weak and DUST continues strong.

Molycorp (MCP) - Long this stock from 7.45 area and have not added during the recent dip into the 5.80 area. Continue short calls against the shares for downside protection.

Nuance Communications (NASDAQ:NUAN) - Remain long this stock and sell 19 and 20 strike calls against the shares. Continue to buy this stock on dips below 18.50. Remain hopeful this pops to 20 plus and takes away my shares when the calls I am short are exercised.

Cliff Natural (NYSE:CLF) - I remain bullish this stock on trading below 25.50 and I like to buy on small dips and sell out on small rallies during the day. Eventually I see a bottom in this stock and it could be the sleeper trade of 2013.

Although I have left Green Mountain (NASDAQ:GMCR) and Herbalife (NYSE:HLF) alone recently, the stocks continue to move higher and the chart patterns looks quite positive. Unfortunately I prefer trading stocks below a $40 stock price because I can buy more shares. I briefly traded Apollo Group (NASDAQ:APOL) but have since turned quite negative on the private education sector. I feel very fortunate to be able to say I walked away unscathed. The sector continues to be a disaster.

Disclosure: I am long AAPL, CLF, NUAN, PBR, DUST, MCP.

Additional disclosure: I am long AAPL calls, short MCP calls, short NUAN calls, short DUST calls.