Risky Bet

With earnings out tonight and a HUGE short position the bears would love to see VPRT get destroyed. Either way you think this will go...expect an explosive move after hours...




Trade well,
Trader D

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NVAX Update

Congrats to all those who got into NVAX from our posting on Sunday. We just sold 1/2 position for a 34% gain. Not bad for three days....

Trade well,
Trader D

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OHB Short Squeeze

We wrote about this stock a few months back and noticed that it had an outrageous short ratio. The current days to cover is 166!! due to the light volume. This is the highest ratio we have ever seen and it looks as though this may keep going.

Trade well,
Trader D

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Trading updates

Let's Update the stocks we wrote about on July 8th as stocks with upside potential:

FAS + 51%

YGE +55%

DRYS + 36%

Looking at DRYS today...it closed above the 50 day MA on great volume and looks like it could reach $9

Why did these stocks look good to us at ITM and how did we pick them?? Checkout our site at http://www.intothemarkets.com for our six session course that shows you how.

Trade well,

Trader D

Wild Cards

Every portfolio should have a very small percentage in high risk "lottery"plays that you can let ride for the long term. Here are two that we picked up:

Beacon Power Corp (BCON) is a way to play the Energy Grid which should be a theme that plays out for the the foreseable future:

Novavax (NVAX) is a play on the Swine Flu which will be returning for the second time around this fall:

Trade well,

Trader D

Complacency

We have hit the 3 year support on the VIX. If you have a crystal ball into the future and you know where the markets are going....the time to buy options is now.

Have a great weekend!

Trade well,

Trader D

Banner Day

The market continues to surge higher as the bears rush furiously to find excuses why this move is not based on reality, cannot continue much longer, and/or is all a part of a grand manipulation by the Government and Goldman Sachs.

While this nonsensical rhetoric goes back and forth - the markets continue to look fantastic!

The NASDAQ is getting crushed after hours with less than stellar earnings by Microsoft (MSFT) & Amazon (AMZN). Most likely the markets WILL dip tomorrow morning which for the savvy investor will provide a BUYING OPPORTUNITY.

We want to give a shoutout to Mr. James Cramer who has since March said that the upside potential is very great and the move up is REAL. Critics try to knock him down every chance they get but in all honesty...He is a standup guy, intelligent, and most importantly - has called this market correctly this year.

Trade well,
Trader D

p.s. STAR beat by .03 after the close and is looking DOWN about 2.5%. Let's give it a chance.

The shorts today

Trade well,
Trader D

VPRT Update

We mentioned VPRT a few days ago in relation to the high short interest and earnings coming out soon. A report was just issued from the following website:

http://www.citronresearch.com/

Andrew Left is VERY good at what he does and although we try not to get affected by outside "noise", there is no reason to take on the associated risk of the future earnings deterioration.

Trade well,
Trader D

CELEBRATE

There´s a party going on right here A celebration to last throughout the years. So bring your good times and your laughter too We're gonna celebrate your party with you !

The market is on fire and earnings (on lowered expectations) are beating the estimates left and right. Here are two more nice setups:
GMCR - July 29th (short ratio = 8.7)

STAR - July 23rd (short ratio = 4.7)

Trade well,
Trader D

VPRT

We will be highlighting some charts that have upside potential with earnings announcements in the upcoming weeks.

VistaPrint Limited (VPRT) has had unbelievable moves after the release of the last two earnings announcements (highlighted below). With 30% of the shares outstanding short and the short ratio of almost 14, July 30th may be a great time to trade this stock. As far as the fundamentals are concerned, VPRT is #5 on the IBD 100.

Trade well,

Trader D

Mass Media Hype Vs. Reality

YESTERDAY'S NEWS HEADLINES:

Roubini to The Street: Chill Out
Even Dr. Doom seemed to be all sunshine and lollipops yesterday. Nouriel Roubini, one of the few economists to accurately predict the magnitude of the economic crisis, told a Chilean investors’ conference in New York that "the freefall of the economy” is over. “There is light at the end of the tunnel," he said. "And the light at the end of the tunnel for once is not the one of an incoming train.”
U.S. Stocks Rise as Roubini Reiterates That Recession Is Ending
July 16 (Bloomberg) -- U.S. stocks rose for a fourth day, the longest streak in six weeks, as economist Nouriel Roubini said the worst of the financial crisis is over and reiterated that the recession may end this year, while takeover speculation lifted commodity shares.
Worst behind us but more stimulus needed: Roubini
Reuters - Nouriel Roubini, RGE Global Monitor Chairman, attends a luncheon in New York July
NEW YORK (Reuters) - Nouriel Roubini, one of the few economists who accurately predicted the magnitude of the financial crisis, said on Thursday that the worst of the turmoil has passed.

TODAY:

It has been widely reported today that I have stated that the recession will be over "this year" and that I have "improved" my economic outlook. Despite those reports - however - my views expressed today are no different than the views I have expressed previously. If anything my views were taken out of context.
I have said on numerous occasions that the recession would last roughly 24 months. Therefore, we are 19months into that recession. If as I predicted the recession is over by year end, it will have lasted 24 months with a recovery only beginning in 2010. Simply put I am not forecasting economic growth before year's end.

Trade well,
Trader D

Take out or Deliver?

Next Wednesday PF Changs (PFCB) reports earnings. With a short ratio over 12, we could see this stock take out it's highs (adjust your position size for the low volume).

Trade well,
Trader D

Here we are

On July 8th we wrote about a possible pop in the market. With the last two days positive and the futures raging after hours (positive Intel earnings), we will quickly push into the overbought level as the ADX remains negative. We will be cautious here to see what the next move is and the possibillity remains high that we could see a sideways market for the next six weeks. If you are using options to trade make sure you go out at least 90 days.

Trade well,
Trader D

SRS (again)

We continue to really like SRS as the indicators are all headed up and a short term break of resistance could send these shares much higher.

Trade well,
Trader D

FYI...FAZ/FAS

Direxion To Reverse-Split FAZ/FAS
Written by IndexUniverse Staff
Tuesday, 07 July 2009 06:12 Related ETFs: FAS / FAZ

Direxion will execute a reverse split of its leveraged and inverse financial ETFs on July 9, after the two funds’ share prices fell so much that they became overly costly for investors to trade.
The Direxion Daily Financial Bull 3X Shares (NYSEArca: FAS) will execute a 1-for-5 reverse split, meaning shareholders will receive one share of the new FAS for every five shares they own today. For the Direxion Daily Financial Bear 3X Shares (NYSEArca: FAZ), the ratio will be 1-for-10.
Investors won’t lose any money on the deal of course, because each share will become more valuable. Based on yesterday’s closing prices, the reverse splits will raise the per-share cost of FAZ from $5.12/share to $51.20/share and boost the price of FAS from $8.34/share to $41.70/share.
The reason for the reverse split is simple: With the share price so low, FAZ and FAS had become uneconomic to trade.
Both funds trade at the minimum possible spread of one penny per share, which means investors lose 2 cents on a round-trip trade due to spreads. That may not sound like much, but with the share price of FAS at $5/share, 2 cents is 0.39% of the fund.
Moreover, many brokers charge investors a fixed per-share fee to buy and sell securities: sometimes one penny, but sometimes 2, 3 or even 4 cents per share traded. If you paid two cents per share on each trade, that means a round-trip trade cost you 4 cents per share. Add in the 2 cents' worth of spreads and you’re talking 6 cents a share to trade the fund. Again, that may not sound like much, but 6 cents per share works out to a 1.17% fee to buy and sell FAS at current prices. That’s more than the fund’s annual 0.95% expense ratio!
By executing a reverse stock split and raising the per-share price, the cost to trade will be reduced: 6 cents on a $51.12/share stock price is only 0.117%. To put it another way, the cost of buying and selling $50,000 of FAZ will drop from approximately $117/trade to just $11.70/trade.
The idea was proposed by Matt Hougan on the IndexUniverse.eu blog in early June.

Expect the unexpected

Most if not all analysts believe the market is coming down hard. We agree but...with the STOCHS possibly coming off a double bottom and a clear positive divergence in the MACD we may very well see a bit of a rally here. Some positions we like are DRYS, FAS, YGE for a quick pop.

Trade well,
Trader D

Casualty of cheap oil

Pickens paring down wind farm project
Monday, July 6, 2009
By ELIZABETH SOUDER / The Dallas Morning News

T. Boone Pickens' plan to build the world's largest wind farm is off.
Instead, Pickens said he will build five or six smaller wind farms, in the Midwest and possibly Texas, though he hasn't settled on locations.

Last year, Pickens announced that he would build a 1,000-megawatt wind farm in Pampa, Texas. The problem a lack of a transmission line to bring the juice to population centers, Pickens said in an interview last week.
"I don't think the first place we build, though, is where we thought we would because we don't have the transmission," he said.
Remember that idea he had to build his own transmission line? "It was a little more complicated than we thought," he said.
In May 2008, Pickens announced that his company, Mesa Power LP, would order 687 wind turbines, or 1,000 megawatts of capacity, from GE for about $2 billion. By 2014, he expected to expand the Panhandle wind farm to 4,000 megawatts.
That's a massive amount of wind power. One nuclear power reactor is typically about 1,000 megawatts of capacity. Most wind farms offer only a few hundred megawatts.
Shortly after announcing the plan, Pickens ran into roadblocks. Natural gas prices took a dive, bringing electricity prices down with them, and making it difficult to finance a new wind farm.
"You had them standing in line to finance you when natural gas was $9" per million British thermal units, he said. "Natural gas at $4 doesn't have any people trying to finance you."
But, he said, he's lined up financing.
He couldn't easily line up a transmission line.
The Public Utility Commission created a plan to build $5 billion in transmission lines to bring wind power from several areas of West Texas to North Texas and the Houston area. The lines will reach as far as the Panhandle but won't follow a path that Mesa had suggested for the Pampa project.
Still, Pickens already ordered the initial round of wind turbines.
GE will start delivering them in the first quarter of 2011. Pickens has about 18 months to find a place to put them.
"I don't have that big a garage to put them in, so I've got to start getting ready to use them," he said.
Pickens said company officials are considering six sites, including places in Wisconsin, Oklahoma, Kansas and Texas. He aims to build three or four wind farms with around 150 turbines each.
He said he still wants to expand to 4,000 megawatts, but he hasn't placed that order yet.
Pickens also said he is rebuilding his three hedge funds after turning them into cash last year.
When the markets dropped, Pickens decided to allow his investors to take their money out of the funds early.
Before the markets declined, Pickens managed more than $4 billion in the funds. Now the funds hold about $1.5 billion.
Pickens is reinvesting the energy funds and said, "We got a good year going."

Trade well,
Trader D

Enjoy the 4th!

This summers latest blockbuster...GOOD NEWS BEARS!!

Stochastics = headed down
MACD= Ditto
ADX=Negative move getting stronger

Trade well,
Trader D