HOLY COW, BATMAN! There are 20 Recommendations on my "GOOD MORNING, GOOGILLIONAIRES!" post of yesterday! I actually took parts of about 3-4 of my recent posts and put it into one....looks like a lot of you got something out of it. So, I'll re-link it again, today, because it is still very germane and many of you may not have seen it that may enjoy it. I really appreciate all the recommendations and respect shown therein....it tells me that I'm hitting the mark insofar as communicating something of use. Thank you all!
Keep in mind that when accumulating puts, it is like buying insurance. Sometimes you pay and pay and pay for, say, auto insurance and never need it at all.....but when disaster comes, you are VERY glad you have that insurance....one claim can FAR outweigh anything you paid. Same goes here. In some cases, I've accumulated puts that I had losses on or even withered away to zero....which meant my call options and equity SOARED. But, to not have SOME degree of puts ALWAYS on hand to offset rainy days (like yesterday) is risky...especially on a stock like GOOG which is capable of 20-40 temporary point roll backs.
Weather looks VERY good today....no rain.
I think we'll have a better day than most think. I'll go a step further by saying that those speculators that bought into the JAN $440 call options during the final hour "meltdown" yesterday are very likely to be rewarded handsomely.
In fact, I'm one of them. I know...I always tell you to get out and stay out of current month options about 3 Wednesdays prior to OE. But, if you have risk capital (money you can afford to easily lose and not have ANY qualms about it) and you see what could be a VERY good opportunity (like the one in last hour yesterday) GO FOR IT! I simply could not help myself...I had to give it a shot, so I went for it! It looked like TOO good of a posible opportunity to turn my back on it.
I bought 800 contracts of the $440 calls when we plunged $10 a shares near the close and hit the 433 low. I was filled when GOOG traveled between 434 and 436 and then I shed 500 of those contracts at a profit shortly theresafter for a VERY nice gain in a matter of minutes. I thought we may pop up above 440 yesterday, so I held the remaining 300 contracts to no avail and decided to roll the dice on keeping those remaining 300 contracts into today. We'll see. Again, all this represents a very small portion of my cash on hand and, because of the gain on 500 contracts, I'm sitting OK on the remaining 300 with little exposure.
DO NOT DO THIS AS A GENERAL RULE! I only mention it so that you can watch one of my many plays and my enemies can have a good laugh on me if I eat
I believe that we will trade as high as 448-455 today and will close between 448 and 450.30. I think yesterday's late day sell off was an anomaly and was caused by the DOD news hitting the wires and the overreactions to it...otherwise we'd have closed more like 453-455 or stayed up around the 446-448 area at least.
So, there you have it. Again, If I'd lost ALL the money on the WHOLE 800 contracts, it would have been OK. Which is the ONLY way to play a PURE spec play like this. I still have over 5000 option contracts in farther out months on GOOG and also a heavy load of shares of GOOG as well as shares and options on several other stocks...all intact. This was a mere, spur of the moment, spec play! OK?
Have A Great Day All!!
i guess you might want to rethink where goog will close today and trade today??
Also, the other 5000 contracts should be pretty worthless soon. Please let us know how it works out..BAAAAHAAAAAA
I think that was a smart trade, itm. I do that myself, from time to time. It's all the same really -- just the risk and reward grow as OE nears, and you need to pick your gambles very carefully and act all the more quickly. (As if Google isn't volatile enough already!)
I'm actually in a similar position right now . . . short the 440 puts (left open when I closed my 460 puts that they were hedging yesterday). But I plan to close immediately at the open.
I hope you don't consider me the enemy you mention just because I take a contrary position now and again and am skeptical of technical analysis. I am well aware that you have been right more often than wrong.
Nothing....nothing long term matters but earnings on jan 31 and that will give us the basis...jaw dropping news to move her north of 500....everything else is meaningless. and noise before earnings....always works that way.
I hope you're correct on the 440's finishing in the money, or trading well up today. I'm holding contracts from yesterday's dip as well, although I went further itm (410,20,30's), and many less in number.I normally do not trade options this close in either, but was seduced by the dip, and I'm only working with the house's money here....I hope you have a great day!
I know the difficulty in trying not to take another bite of the apple. I traded short yesterday 4 times when I could have had just one. I didn't expect the "meltdown" though so I'd covered. But when it happened, twice, I just couldn't let it pass unexploited!
Good luck and let us know if/when you manage to unload them. That is, unless you don't plan on exercising them.. to defer your capital gains like our friend bmp. ;)
For the first time since I entered GOOG shares (at about 130) and call options duriing Sept and October of 2004, I have no position whatsoever in GOOG. None at all.
I dumped every share I had and every call option I had last Friday as soon as I could get out...at market..so that I was totally out of all calls and shares by trhe time we hit the 430s to 420s. Only thing I kept were the puts I had started re-accumulating (after I'd dumped them on previous days' lows). But, I had the biggest day of my entire career on those puts and, mainly, on the heavy buying of JAN puts I did on the way down. It was a perfect storm for that, as the option expiration created a scenario whereby ANY out of the money puts were nearly worthless before springing to MAJOR life as GOOG kept free-falling. I added heavily (100s of contracts) to the puts at the strikes of: 430, 420, 410, and 400. Thank God for puts....again...now you know why I ALWAYS remind you to accumulate them! By far, the 420s wewre best for me (I bought more of them than any others) and the 400s did the worst even though I traded in and out of them several timers. I was completely out in the $400-$402 areas on the puts way ahead of the eventual turn down at 3:50pm to 395.
GOOG, as I said last week, has lost the optimistic sentiment and is selling off into any strength FAR too often to be a safe investment for, especially, call options any further. All this could change, but I do not trust it at all....and after such huge gains since Sept 2004, who needs the risk or aggravation.
GOOG may possibly pop up to the 420...or even the 430 area, but could easily collapse again back to 400 or even go into another free-fall to as low as 350 today or tomorrow. Friday's option expiration probably helped prop it up and a lot of exercising must have occurred. Expect possible HEAVY volatility between today and Wednseday.
However, with earnings around the corner, we SHOULD see a good to very good rally off whatever bottom we establish over the next 3 days. A rally that could take us up to the 450++ area by Friday or Monday and even higher by the close on Tuesday, Jan 31.....after which, the E/R is released. With a blowout E/R, we could jump another 30-60 points overnight IF it IS a major blowout....and, I think it will be. But, you never know about these guys during the CC. So, I will probably be well positioned by then with about 60-70% call options and other bullish strategies and about 30-40% puts and other bearish strategies.
I hope you all saw my urgent strong sell last Friday which came when I knew we'd tank below 400 but not soon enough because I was scrambling myself to complete trades.
Hey ITM, now I know you are full of it. Too bad too. I was hoping you really did know what you were talking about.
What happened to the 100's of shares of 440Calls that you bought? I suppose you dumped them in the nick of time, just before you bought 100's of Put contracts.
Ignore this guy!
I should have put a few forecast in my last post. I mean....what the heck is an itm2000 post without a forecast!
Really, GOOG got slammed for no valid reasons and should have had intraday highs of 500 by now and still be trading near that area. Seems like a few "prognosticator" wannabes are trying to making a name for themselves by issuing self-fulfilling prophecies of meltdowns. Wonder what they'll say when GOOG turns in a TOTAL BLOWOUT E/R!?
GOOG will surpass $2.30 EPS....perhaps 2.50+..and revenues will be as off the charts as some are already speculating. We should be trading with some gaps occuring between now and JAN 31...with a possible pop of $50 a share overnight on JAN 31. My guess is that GOOG, which normally releases its E/R about the 21st, probably has ALL the numbers RIGHT NOW...or will by Monday or Tuesday LATEST. Watch for signs of leaks...they may even pre-announce and catch EVERYONE off guard!
It is going to be an incredible 10 days ahead!
Whether or not GOOG blows away earnings is yet to be seen. However, when a stock gets this high, deservedly or not, it is easy to sppok the cattle into a stampede. Mark Cuban et al know this. Everyone is on a hair trigger. It does not take much to get the little guy moving to protect his/her small investment..Look for more and more volatility as GOOG moves upwards and onwards, and buy the occasional big dip like yesterday.
JMHO, as usual.
I expect GOOG to reach the 480-500 area by or before the closing bell on Tuesday, Jan 31 and intraday highs of 550-600 somewhere between Jan 31 (AH) and mid FEB.
After that, we could have a severe roll back that may not be so temporary. So, be very careful and be very certain that you have racked up LOTS of puts by then. By them when GOOG shows strength...especially on spikes or hyperbolic (very rapid and vertical) moves up.
Gads........Makes one feel like a bouncing ball....boing....boing...boing.
Tug of war through, possibly, tomorrow.
But, definitely be covered on your shorts and in WELL long before Monday's open.
Definitely a little skeptical about Monday - this stock is so weak in relation to the NASDAQ that I think the 450 OE might be its best chance. In fact, I'm not entirely ruling out 440 either.
We should be snapping back above 450 but we're not - makes me think we might actually take a hit on Monday.
Will go in one direction or another Monday morning.
Er... no. If I thought that anyone was an oracle of price movement I wouldn't be spending time studying charts and paying for real-time data. It's a gestalt thing, where all of the info out there adds into something and a pattern emerges, if only for a short time.
You seem a bit naive.