From this point is about to leap back to $16.00 in very short order. Why? Seasonal demand for silver always translates into better prices for the metal. Silver's antibacterial properties has found use in all types of surgical gauze and creams, especially when MRSA is increasingly a problem. Then we have rotation back into commodities as fund managers readjust portfolios for 2016. Remember, there is a great abundance of fiat currencies waiting for their day of reckoning, and China may soon pull another currency devaluation in anticipation of a Fed rate hike which will hurt our exports again.
Gilead had stellar earnings. The same happened with Celegene and Amgen in recent quarters. Many traders use complex investment algorithms to filter out stock price movements based on short interest, options, sentiment, order books, electronic trading points, etc. Some market makers buy a lot of shares driving the price up. They write call options at the higher stock price. Then they sell their hoard of shares at specific data points so the call contracts expire worthless. Like a whale sucking in krill. It is counter-intuitive, so you may have to be on both sides of the trade, perhaps a straddle right after the earnings announcement. Why? Because their algorithm will determine the best path forward at the earnings announcement and whether the stock should be dumped or acquired. Based on traditional investing Gilead is doing everything right, and their stock price was unjustly punished by greedy SOBs. Probably the same ones who participated in the financial meltdown in the first place.
Yes. Tempered enthusiasm along with cautious optimism go hand in hand. I am glad the K+S deal failed because it was overpriced at $41 euro. By the way, K+S fell about 30% when POT pulled the plug. All in all, POT can now concentrate on core efficiency, reducing debt, and increasing shareholder value. Thanks for your candid reply.
Now that the K&S deal is off the table, POT is in a much better position to increase share holder value. I am not surprised to see POT get so much positive attention because it is a pure value play. Also, notice that the January 22 call option contracts are going through the roof. I just bought a bunch of shares based on the news.