MOS is taking a huge dump! Glad I sold a lot of shares. POT is being sold on the news of their earnings DOWN HUGE, I am jumping in on the short right now @ 200. 183 cover target (near 20dma).
MY ISRG trade is done stopped out @ $280.
Apple popped, then dropped...I'm not doing anything with it though.
Wow what a crazy first half hour!
Disclosure
Long AAPL, GOOG, 25% MOS
Short X, POT
Update 1 @ 10AM PST: Wow amazing reversal in the market. Apple is now positive. MOS have parred losses and so has POT...I'm pretty much even on that short now.. Damnit should have taken the gains this morning...oh well I think this one still has some ways to go down though price is just way too inflated.
As for BIDU requested by a reader...this one is really tough. You know my rule is to never do anything into earnings. But if I had to choose a side, I would short this stock into earnings:
For the reasons being:
-This one ran way too far. And is now pretty much pricing in a perfecta quarter ($201 to $364 in a month?!?!?)
- Overstretched technicals.
- You can see a gimped version of a "W" pattern but it is undeniably there. And W patterns are bearish if the current price right now is toward the "right top part" of the W
- The market indices right now are up big on positive territory: Implying people are getting way bullish
- 1st level of support is at $300 bucks THATS A LONG WAY DOWN MY FRIEND
- The monster beat Google had last week would mean Bidu is now expected to blowout big. Remember, expectations and market sentiment plays a huge role in stocks. During Google's ER nobody expected ANYTHING and too much pessimism resulted in a mega catapult. BIDU is now different because the stock kept on getting bought throughout the good and bad times... If they disappoint in any way at all, or just barely meets expectation, or barely beats it, imo it is already built into the stock premium for the short term. It really leads me to believe this will selloff AH.
The only catalyst I can think of right now is the fact that the Chinese Government recently revised the Tax laws...but even so...that's not enough of a reason for me personally to put my chips on the long side.
Anything can happen though because Chinese stocks are known for its surprises...But if you're asking my opinion, I think the majority of the upside in the market for the short term has already been seen. Maybe we get little gains here and there until the end of the month. But be very careful.
As for the other person asking me about put/call ratio. I'll dig into it more. Stay tuned
- DL
Update 2: 11AM PST
I'm getting so tempted to pull the trigger on the Bidu short (just a very small position) to see where it goes. I figure even if it goes up 10-20 bucks its not gonna be the end of the world for me. But I'm really liking the odds and the market's bullishness today is not gonna help it at all. One of the readers said a lot of positive catalyst that might be coming BIDU's way and I absolutely respect that. But for the short term, this is just looking way too tempting to not try. From the daily 10 min chart BIDU is now clipped right inbetween a necktie that's why we are probably not going to see much movement going into ER. Before the end of the bell, I'm going to throw on a small position (like 50 shares) to see how it'll end. I just want to be clear though this trade will end tomorrow regardless of what happens. If I get annihilated I will sack my losses. If I make a quick profitable trade, then I'll be treating myself to a nice steak dinner this weekend :)
Disclosure: Short BIDU
After the bell: I've done it...shorted BIDU at 345...holy smokes been a long time since I've done this. It is kind of gut wrenching...
MSFT MISSED EARNINGS FROM JUST THE FIRST LOOKS...STOCK IS SELLING OFF AH. Hmmm.
We also saw the market selloff before the end of the day. Gains were nearly halved from it's intraday high. With MSFT at a first glance missing expectations we could see the sector get dragged down tomorrow. It's too early to say without listening to the conference call, but we're going to find out very soon.
BIDU is not set to report its numbers until 8PM EST. So that means 5PM PST? This means we're probably not going to see the numbers AH reflect until tomorrow morning. Nevertheless, good luck to both longs and shorts (although for my personal stance, it is my belief it's gonna go down, hey after all, I got my money where my mouth is!)
Good day for apple longs...amazing reversal today for the stock.
X = Tankage = goood. I'm expecting more from this
POT went back toward its lows and finished off at about $193. Up $7 today. Not bad
TANK BIDU TANK!!!
I'm out for now. Invest wisely and best of luck!
- DL
Disclosure:
Long AAPL, GOOG, 25% MOS
Short X, POT, BIDU
Final Update: Bidu Earnings are out!
And it looks like at a first glance I'm on the wrong side of the trade...I'm down about $10 bucks AH right now. Stock is at $355. Trying to reflect on what happened...perhaps the selloff at the end of the day is giving this some room to run? But Earnings came up light...60c vs 67c. Nevertheless, shiet...Can't win them all...and this little experiment further reinforces the idea into me to not play earnings...just don't know what is going to happen.
But for all I know, the stock could be sold off on strength tomorrow. It was just like Apple today reversing from losses to gains. BIDU any way that is sliced is still a very overstretched stock in the near term. Guess I'll just have to wait and see what happens during the conference and tomorrow.
And one more idea that has reinforced into my discipline: The easy trade is NEVER the right trade. The hard ones are....
5 comments:
Dear xman
Your blog really inspire me alot especially your entry/exit rules, kudos for that.
Have been thinking what's your view on BIDU this stock, co is expected to announce its ER AMC today.
Cheers
j8
I know the xman is about quicker trades, but if you wanted to take a bigger picture view, would you look at the put/call options for a stock to see downstream potential? I noticed the drop in POT (probably due to earnings as you said), and MOS and ag is falling as a result...but if you look at the calls for Sept there's huge volume for the $145 and $170 calls...do you incorporate that into your tech analysis (i.e. accept the dip, but know the stock still has a potential run up so buy when the indicators are positive)?
joul ooi,
Swing trading is all about discipline. Because if we don't follow it, trades become investments...or if we are shorting, trades become bigtime losses. :)
As for Bidu...oh boy...this is tough.
check my update blog post I will post chart
Dear xman,
Excellent comments on BIDU's recent performance. This strengthen my believes in using strangle strategy on it if I were to commit in playing prior to its earning release. I think the recent catalyst might be on:
1) The instant messenger service launched by the co.
2) The co. recruited former GM and AAPL top-notch people to refil its CFO and COO ranks.
3) Recently the co. just launched its online gaming business in co-operation with one of the Nasdaq listed gaming co.
4) It's one of the strongest performance chinese stocks listed in the US market and
5) The upcoming Olympic games which will boost its revenue though paid-click or advertising industry especially we have only 105 days left to go.
6) The recent Edison photo scandal which involve illegal distribution of intimate and private photos of Hongkong celebrities spark the paid-click traffic between late January until March. (Not sure how huge it is but it's the hottest topic among Asia's entertainment news, and you will get all you want from www.baidu.com)
I would have to agree with you that from TA point of view, it's repeating ISRG/AAPL/POT and this is the part which is disturbing me.
I would have thought the 1st resistance is $400 and support will be just like what you have illustrated - $300. A play of May 400 Call couple with May 300 Put might be the way to go.
Let's see how it goes.
Thanks alot for your analysis, it's my pleasure to have your point of view on this stock.
Regards
Joul
Are there any books or websites you can recommend on technical analysis? Or explain how to further develop TA skills.
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