Dow from -200 to +30 - can it hold? Or will we have a sell off into the close?

Plato - 15 January 2009 02:34 PM

Dow from -200 to +30 - can it hold? Or will we have a sell off into the close?

With the vix as high as it is, however the day ends could be quite dramatic.

I added a black swan counter to my signature.

C and BAC getting back stopped by gov. Buy in kids sell at the EoD.

ConMan - 15 January 2009 02:42 PM

Plato - 15 January 2009 02:34 PM

Dow from -200 to +30 - can it hold? Or will we have a sell off into the close?

With the vix as high as it is, however the day ends could be quite dramatic.

And AAPL doesn’t keep up with the indices’ move.

Watch out Cramer is coming up. He said last night to stay out of AAPL - if he repeats it again - watch out below.

This is surprising.  Not the media torrent, but AAPL’s bucking the AH trend from last night.  Down 2%?  Not even a flesh wound!    Maybe, just maybe, investors don’t care as much about SJ’s health as they do about Apple itself.

Mav - 15 January 2009 03:36 PM

This is surprising.  Not the media torrent, but AAPL’s bucking the AH trend from last night.  Down 2%?  Not even a flesh wound!    Maybe, just maybe, investors don’t care as much about SJ’s health as they do about Apple itself.

I think we will have the same reaction we had before after bad news.  A huge selloff in AH with a nice recovery in regular market.  And then the next few days we go back and retest those lows.  I think we will see 76 by end of next week if the market goes down as well.

I did put in an order at 78 for today, but I should have bought in AH yesterday but was too busy.

Plato - 15 January 2009 02:53 PM

Watch out Cramer is coming up. He said last night to stay out of AAPL - if he repeats it again - watch out below.

Did he mention AAPL? I missed viewing the bald-headed monkey.

Intel Corp. on Thursday reported a fourth-quarter net income of $234 million, or 4 cents a share, compared with a net profit of $2.27 billion, or 38 cents a share for the year-earlier period. Revenue was $8.2 billion, down 23% from $10.7 billion last year. Analysts had expected the Santa Clara, Calif.-based chip maker to report earnings of 4 cents a share on revenue of $8.2 billion, according to a consensus survey by Thomson Reuters.

What an incredible day: it looks like there were plenty willing to take Buffet’s advice in times of crisis, at least when it came to AAPL… and once again I was hors de combat for much of it, travelling.  Why does this always seem to happen to me on critical days?    Henceforth, I can make travel plans and then trade in full confidence that such days will be market turns!

When I saw how well AAPL held up after-hours last night, I thought, maybe, we could close above $80 today if all worked out well, and buyers were ready to step in.  I presumed we’d see more and more buyers coming in as the price fell into the 70s, especially considering the wave of analyst reassurance (for once the analysts were on our side in a crunch).

Instead, the low today was 80.05!

Even without the travelling, I had intended to stay out of today’s action owing to the massive uncertainty, and I still feel we’ve a trip through at least the upper 70s in our near future, but if the market rallies in earnest tomorrow, it’s quite likely to continue into Obama-week.  And of course Apple has Q1 earnings too.  So at least for this little downturn, today may have been AAPL’s bottom.

To all those who were brave enough to buy, I salute you. 

Options Traders Take a Bite Out of Apple

By STEVEN M. SEARS

The news of Steve Jobs’ medical leave is causing many investors to bet his company’s shares won’t be rising anytime soon.

CHARLES DE GAULLE ONCE said the graveyards of the world are filled with indispensable men. Clearly, he never met Steve Jobs.

The Apple chieftain’s decision to take medical leave until June has awakened the worst fears investors have about the consumer-technology company.

Jobs is so closely associated with Apple that investors are afraid the company will flounder, or worse, if Jobs is not around to run things. Tim Cook, Apple’s chief operating officer, will handle Jobs’ responsibilities during the medical leave, and Jobs will be involved in major decisions.

The news sent Apple’s stock, already sagging from concerns about Jobs’ ongoing health problems, sharply lower. In the stock market, the prognosis for Apple’s shares seems grim. The story in the options market is more nuanced.

Some traders are selling January calls to bet that the stock, now down about $5 in midday trading Thursday to $81, will remain below $85 in the short term.

This explains the rash of trading in January 80 and 85 calls, all of which expire Friday. Similar trading is occurring in the January 80 puts. Clearly, this is opportunistic trading of traders trying to scalp options premium before January options expire, or otherwise salvage whatever value is left in their positions.

In February and beyond, Apple’s trading patterns tell a similar story, but trading volumes are much lighter. This suggests that investors are taking a wait-and-see approach until more is known about the impact of Jobs’ decision on the company.

J.P. Morgan Securities’ Mark Moskowitz told investors this morning that he does not expect Jobs’ medical leave to disrupt operations.

“In our view,” Moskowitz said, “Mr. Cook and the other members of the Apple management suite have played a critical role in monetizing the vision and mandates of Mr. Jobs in recent years. Here, we do not expect any changes during this difficult period, and we expect the R&D pipeline to remain robust.”

For investors who believe the Apple technology phenomenon is bigger than any one man, the options market offers some tempting opportunities. Michael Schwartz, Oppenheimer & Co.‘s chief options strategist, likes a 2011 “call spread” that can lead to an investment return of 189%. This strategy is obviously not for traders who don’t like committing capital for such a long period.

Schwartz recommends buying January 80 calls that expire in 2011 for $29.95, and selling January 120 calls for $15.75 with the same expiration. The net debit is $14.20. The trade breaks even if Apple’s stock trades to $94.20 and has a maximum profit of $25.80.

Apple is scheduled to report fiscal first-quarter earnings Jan. 21. The tenor of this call, arguably more so than the actual results, holds the key to investor sentiment.

Somebody is going to get badly burnt, IMHO.

Pre-Market value on Google is $84.94!    This about the same price as €64 on German markets, but there have been only about 1300 shares traded so far.

This would mean we are already at the same level as before the news about Jobs. I would have never expected such a quick rebound, probably Apple without Jobs was really already priced in by WS.

Google?

willrob - 16 January 2009 06:41 AM

Google?

Sorry, I meant AAPL Pre-Market value on Google finance

German markets have now more than 2000 shares traded around this value.

OE Friday
Max Pain at 105
Should be an interesting day.

 
R4     94.73
midpoint   92.69
R3     90.66
midpoint   88.62
R2     86.59
midpoint   85.79
R1     84.98
midpoint   83.75
PP     82.52
midpoint   81.72
S1     80.91
midpoint   79.68
S2     78.45
midpoint   76.41
S3     74.38
midpoint   72.34
S4     70.31