Strangling Citigroup

Written By: DragonFly Capital

Citigroup reported earnings on Monday, tax day, what seems eons ago, and ran higher. We traded it in the premium area for a good gain. But it has interest now because of the Bearish Butterfly shown in the weekly chart below. This pattern has a target for a reversal at 48.90, a point it is falling just short of. On a reversal lower it has a target of 38.40, very near the 200 week Simple Moving Average (SMA) on this chart. The Relative Strength Index (RSI) is making lower lows and the Moving Average Convergence Divergence

c

(MACD) indicator is starting to roll lower. Seems a break under 42.70, whether it hits the Butterfly target or not, is a good longer term short entry. It could also just fake out every one and cause that pattern to fail with a move over 51.50 Either way it has potential. One way to play this is to buy the July 42/50 Strangle right now. This is offered at $ 2.10 late Thursday (4.65%) and has 3 months to play out. The great news is hat this stock also has weekly options so that you can sell a weekly Strangle against it each week for 13 weeks to recoup you cost while you wait for a big move, expecting them to expire each week. If you do not have time to watch every week that is no problem, do it less frequently.

Join the Dragonfly Capital Views Premium Membership

Its Time For a Sale at Dragonfly Capital!

marchmadness1

This is the last week! The Annual subscription rate for the Premium Dragonfly Capital Views Service, has been cut by 20% to $ 600. That is nearly 45% off of the monthly rate for a year! Follow this link to start your subscription, with free 7 day trial, today.

Want to learn more about Dragonfly Capital Views?
Dragonfly Capital Views Performance Through March 2013 Expiry

The post Strangling Citigroup appeared first on Dragonfly Capital.

Dragonfly Capital

Who Doesn’t Want DDD’s

Written By: DragonFly Capital

Ok, get your head out of the gutter. I am talking about 3D Systems, $ DDD, the 3D printer. This stock has been a popular trading vehicle no matter which side you are on. With nearly 30% short interest it can be subject to big swings. The Fundamental picture will not get any further clarity until they report earnings at the end of the month so it is even more important to look at the underlying technical currents when trading this stock. It has been a doozy, completing a AB=CD pattern in late January, but with a twist. The CD leg was a 127% extension of the AB leg. And now it is doing it again. This time the CD leg with a 127% extension measures to 61.40. The Moving Average Convergence Divergence indicator (MACD) signal line

3D Systems, $ DDD
ddd

has been moving off of the low since March 18 and has a long way to go to the previous high. The Relative Strength Index (RSI) also bottomed then and is rising with a lot of room and just now moving into bullish territory. And the accumulation/distribution bottomed at the same time and is moving sideways. The cross of the 50 and 100 day Simple Moving Averages (SMA) just overhead is the last major stumbling block before it can continue higher and complete the 3 Drives pattern at D. If you still need some convincing a trader today bought the May 39 Calls and sold the May 27/21 Put Spread, a bullish Risk Reversal, 1968 times for 85 cents. This trader expects the price to continue to rise through May Expiry.

Join the Dragonfly Capital Views Premium Membership

Its Time For a Sale at Dragonfly Capital!

marchmadness1

And what better time than during March Madness. The Annual subscription rate for the Premium Dragonfly Capital Views Service, will be cut by 20% to $ 600. That is nearly 45% off of the monthly rate for a year! Follow this link to start your subscription, with free 7 day trial, today.

Want to learn more about Dragonfly Capital Views?
Dragonfly Capital Views Performance Through March 2013 Expiry

The post Who Doesn’t Want DDD’s appeared first on Dragonfly Capital.

Dragonfly Capital

Joris Naiman

My first helicopter instructor, who became a friend, died yesterday. Joris Naiman was a gentle soul, aged 61, and succumbed to liver cancer, to which I lost my dog George back in 1991. I went to visit Joris last week at his home on the dammed-up portion of the Charles River known as the “Lakes District” in Waltham. We watched a pair of mute swans taking off and landing. Joris and his wife Lesya explained to me that the swans had reared seven children to adulthood in the previous season. Joris shared all that he knew about their feeding and breeding habits and explained the legal status of these visitors from Russia. Joris and Lesya had converted part of their living room into a greenhouse overlooking the river and thus Joris was able to indulge his love of nature from a recliner chair. We talked about plans for the summer and certainly nobody in the room thought that there would be a chance of Joris being gone this week.

Joris worked hard on behalf of the U.S. Fish and Wildlife Service despite a realistic appreciation for the limits of what government regulation could accomplish. I would often phone him at work at 9:00 pm. He could recognize that the politically connected or simply savvy could work around most regulations while simultaneously not being cynical. Joris enjoyed aviation for most of his adult life. He and his wife would fly a four-seat Piper on sunny days to various corners of New England and then get out to hike in the woods. He was very eloquent on the joys of helicopter flight, explaining that it was only with a helicopter that we could feel as though we’d escaped from the laws of gravity and our Earthbound natures.

Joris and Lesya were great dog-spoilers. My Samoyed Alex would stay with them while I went away for a long weekend and he would come back with a treat-stuffed smile and a new fluency in Lesya’s Ukrainian. Although he did not have children, Joris was a favorite of my daughter Greta.

Joris was a moderating influence in nearly every conversation. If you were talking about how the future was incredibly bright Joris might remind you that things tended not to work out as planned. If you were suffering a misfortune Joris would remind you that things probably wouldn’t be as bad as you feared. He kept an even emotional keel right through my last two visits (in March and April), mentioning the irony of the nurses at the Lahey Clinic waking him up at 4:00 am to ask whether he was sleeping well in his hospital bed.

http://philip.greenspun.com/flying/milestones shows that Joris and I had known each other for 10 years. I will miss him.

Philip Greenspun’s Weblog

How Money Moves

The title should actually be “How Dollar Bills Move,” but it’s not as alliterative.

A fascinating item on the work of Dirk Brockmann, who’s used WheresGeorge.com to map the movement of dollar bills, and the boundaries over which they’re least likely to cross:

I have no idea what to do with this, or whether it even has any useful application. But it’s at least a fine example of the fruits of human curiosity.

Cross-posted at Asymptosis.


Angry Bear

InvestingTeacher Launches Today with Interactive Lessons on Technical Analysis

Since our private Beta last year, InvestingTeacher.com has had quite a run. Our goal was to have 100 people sign up for the private Beta. Instead, we ended up with nearly 2,000 people signed up and had to start a waiting list which, as of yesterday, had 900 more people on it.

With over 95% of investors not understanding even the basics of support and resistance, learning how to read stock charts (technical analysis) has never been more important than now.

Up to this point, quality investment education has been expensive and boring to digest. Let’s be honest, paying thousands of dollars to read a bunch of articles and watch DVDs is hardly revolutionary.

To reach the masses and make learning fun, InvestingTeacher is completely interactive with drag and drop functionality, quizzes, drawing, and yes, it is 100% tablet friendly. To really “stick it to the man”, as of today’s launch we are making the first two Courses available for only $ 19.95 each, with four others set to be released in the next few months.

Just read this sampling of testimonials from the Beta:

“Although I’m in my early 50s and wish I understood investing much earlier, your product is AWESOME!” – Kevin P.

“I found your program very informative and recommended it to my mom. I wish there were more content. I’m hungry for more!” – Sarah A.

“I love the courses! They seem to be very logically laid out and very easy to follow.” – Rex S.

I know how much of an impact understanding the basics of technical analysis has had on my own personal investing, and I am extremely excited to finally be able to share that experience with you.

Take the first Lesson for free, right now, by visiting InvestingTeacher.com.

PS – Market Recaps will kick back up tomorrow, so we will see you on InvestingTeacher today, and see you back here tomorrow!

Original post: InvestingTeacher Launches Today with Interactive Lessons on Technical Analysis


Stock Trading To Go

Bonds! Will! Not! Die! Do You Care?

Written By: DragonFly Capital

I can count at least 10 tops in the Treasury Bond ETF, $ TLT, since last July. In fact I have numbered the in the chart below. But in the end, every one of the first 9 have been bought. Now we sit with a higher high, after 4 consecutive lower highs. WTF? I thought Bonds were dead. Well maybe this 10th time is the charm. Monday did confirm a Shooting Star reversal lower, and there is a big gap to fill down to the 120.50

tlt

area. But the yellow lines outline a Shark pattern that is playing out with a Potential Reversal Zone between 128 and 131.20. That is a long way up from here. Does that mean that this rally in equities has to end? How can Bonds go higher and Equities go higher? Isn’t that money leaving Bonds fueling the rise in equities? Has that ever happened before? Uh, yes. How about for the last 4 years. The chart below shows that the trend for both Bonds and Equities is and has been higher. Now if you are a day trader don’t even

tlt spy

bother to send me an inflammatory response, you should not give a crap about correlations. Swing traders, yes I see that there have been times when one took control and the other pulled back and that could happen again. But our jobs as traders should be to first identify the trend and then work with that knowledge. The trend is up, for both Treasuries and Equities.

Carry on.

Join the Dragonfly Capital Views Premium Membership

Its Time For a Sale at Dragonfly Capital!

marchmadness1

And what better time than during March Madness. The Annual subscription rate for the Premium Dragonfly Capital Views Service, will be cut by 20% to $ 600. That is nearly 45% off of the monthly rate for a year! Follow this link to start your subscription, with free 7 day trial, today.

Want to learn more about Dragonfly Capital Views?
Dragonfly Capital Views Performance Through March 2013 Expiry

The post Bonds! Will! Not! Die! Do You Care? appeared first on Dragonfly Capital.

Dragonfly Capital

Where are the center of things?

Via Huffington Post comes this quote:

One senior administration official offered the following explanation as to why they started with a “compromise” offer.

While this is not the president’s ideal deficit-reduction plan, and there are particular proposals in this plan — like the CPI change — that were key Republican requests and not the president’s preferred approach. This is a compromise proposal built on common ground, and the president felt it was important to make it clear that the offer still stands. The president has made clear that he is willing to compromise and do tough things to reduce the deficit, but only in the context of a package like this one that has balance and includes revenues from the wealthiest Americans and that is designed to promote economic growth. That means that the things like CPI that Republican leaders have pushed hard for will only be accepted if congressional Republicans are willing to do more on revenues. This isn’t about political horsetrading; it’s about reducing the deficit in a balanced way that economists say is best for the economy and job creation. That’s why the president’s offer –- which will be reflected in his budget — isn’t a menu of options for them to choose from; it’s a cohesive package that reflects the kind of compromise we should be able to reach.


Angry Bear

Is My Trading Scalable?

Hi Mike,

Thanks for your offer to answer my question this afternoon by email.  I wondered why you said it takes $ 1M – $ 5M to make $ 1M in annual profits?  One can certainly make more than $ 50K annually with a $ 50K account.  Why isn’t the relationship more linear in scaling up?

I must convey my deep gratitude for the invaluable knowledge and encouragement that you continuously share through these webinars and your blog.  Your efforts go far beyond what could be justified as marketing for your firm.  Such generosity and concern for others are a reflection of fine character within and are deeply appreciated.

DJ

Congratulations on your upcoming fatherhood, and hope that it brings Read more […]
SMB Capital – Day Trading Blog

STTG Market Recap Apr 1, 2013

Investors returned from the three day weekend to a bout of selling.  While the major indexes were down materially – the S&P 500 0.45% and the NASDAQ 0.87%, the variation today between the DJIA (down fractionally) versus the Russell 2000, full of small cap stocks, (down 1.34%) told the story of the past few weeks.  Unlike the beginning to middle part of this rally – mid November to mid February, the last six weeks have been about the stodgy, conservative stocks.  Today’s decline was mostly at the hands of a poor ISM Manufacturing report, which was down sharply month over month with a reading of 51.2 versus last month’s 54.2  While anything over 50 is still expansionary this is quite a reduction.

Technically what we had in the S&P 500 was a breakout to new highs last Thursday, immediately met with a bout of selling; not a fun situation.  While the index showed moderate losses a lot of individual names in the index were down 2-3%+ while the same staples, healthcare type of stocks helped the index hold up.  For now the S&P 500 seems content to go back and forth between this small support line (in blue) and the bottom of the accelerated channel it had been traveling most of the rally.

The NASDAQ was more representative of the day it was in terms of losses.

Here is the chart of the Russell 2000 – it has stalled in this 950ish area.

Strangely, the NYMO Oscillator is already in a somewhat oversold state – just a day after new highs on the S&P 500.  The problem is breadth, fewer stocks are carrying the load and even as we saw new highs this index got nowhere near overbought.

Apple was horrid today, down 3%.  You can see on the long term chart it had its one moment of glory in the past few months, breaking over the long term resistance line for two whole sessions, before rolling right back over.

On the positive side here are two charts we found with positive technicals – both are in “bull flags”, and withstood today’s selling; one is an energy name and one is in retail.   Both outperformed their respective sectors on a down day and as long as they hold the bottom part of their flag, should be poised to continue this performance during future positive days.  Finding stocks doing well in down tapes is a good way to find outperformers.

Last, Tesla Motors (TSLA) was the star of the day as the stock jumped on monster volume with an announcement of profitability, and model S sales that exceeded target.

“As customers who note their Model S serial number this weekend will realize,  vehicle deliveries (sales) exceeded 4,750 units vs. the 4,500 unit prior outlook  (from February),” Tesla said in its sales announcement late Sunday. “As a  result, Tesla is amending its Q1 guidance to full profitability, both GAAP and  non-GAAP.”

Original post: STTG Market Recap Apr 1, 2013


Stock Trading To Go

National Bank of Greece Extends Its Losses

As of 12:00 pm EST today (Monday), the National Bank of Greece is -10.38%, as shown below on Bloomberg’s Top Gainers & Losers in the EURO STOXX Banks (Price) Index. The next chart shows the steady decline for this bank since October 2012…not a healthy-looking chart, as it has fallen below its 1-year major support level and is displaying major relative weakness compared […]
Slope of Hope