Entering text into the input field will update the search result below

Market Bouncing or Breaking Down - Following up on 500% Trade Ideas

May 12, 2011 5:48 PM ETEDZ, TM, QQQ, USO, TBT
Philip Davis profile picture
Philip Davis's Blog
Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

$USD WEEKLY Oh boy is this great!  

We love a good market panic – especially when we were betting on it.  We’ve been preparing for this downturn since we set up our disaster hedges again (first time in a long time) on April 21st, which was also a Thursday, when I wrote: "How to Make 500% On The Next Crash."  This wasn’t a Member’s Only post, this was something that any PSW Report Reader (subscribe here) would have had in their mailbox at 8:30 am, before the markets opened at pretty much the levels we are at right now.  Since that post, we went up and we went down again so there was all the time in the World for our Members to establish their hedges and those hedges allowed us to continue to make long bets – knowing we had a nice hedge should the market turn down suddenly.

As it turned out, we had plenty of time to ride the market up to our 5% levels and now we’re on the way back down, likely to test our reference levels again, which are approximately the 50 dmas – all very dependent on how the Dollar handles that 75-76 range, of course (see David Fry’s chart).  

Some of the trade ideas from the 500% post are still available while others are running away like the EDZ Oct $14/18 bull call spread at $1.80, offset with the short sale of TM June $72.50 puts at $1.25 for net .55 on the $4 spread.  Even though it’s an October target, the EDZ $14/18 spread is already 100% in the money but still just $2 but the TM June $72.50 puts have fallen to .24 for a net of $1.76, up 218% in just 3 weeks.  Not a bad hedge for a flat market!  

In Member Chat (Basic, Premium and Voyeur Members), we will be discussing which of those trade ideas are still playable (the EDZ spread is still fine, we just need to find another offset) but even Report Members can profit from my early morning trade ideas like yesterday’s call on the USO May $41 puts – it was right in the first paragraph of the post!  We had picked it up (as I said) in Member Chat Tuesday afternoon for .95 but I still felt it would be a good pick-up at the open.  Here’s the
continue reading

Posted in Immediately available to publicUncategorized | |239 Comments »



Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.