I made a lot of mistakes today

Today was a day when I did almost everything wrong.  Somehow, the gods smiled on me, and I was able to make a profit, but I gave up a lot.  The government changed the rules on the sub-prime, and CFC opened up 25% higher.  I sold a lot of Countrywide (CFC) right after the opening, and got it off at $11.63…it got as high as $12 and change, before it reversed.  No stock in it’s right mind opens 20-25% higher without a firm buyout offer and keeps that level all day.  CFC took about an hour to get down below $11.  I was watching all day, and finally decided to pull the plug on the whole trade.  I bought all my CFC back at $10.78, $10.84, and $10.92 by hitting the offers that had size.  It took three trades to get rid of the size.  Right now, I’m not short any CFC at all.  I won’t stay in a market when they change the rules right in midstream. CFC had a monster day, with almost 100 million shares of it being traded.  With that kind of strength, I decided to take my profits.  Even though I missed the lows of the other day, I still made a massive profit because my position was so large.  However, on my scalping, I made every mistake in the book.  I lost $0.40 on AAPL, got ripped for $0.95 on GOOG and felt lucky.  I sold at the bottom on bonds and took a little hit there.  I went short in the gold market, had bad timing, and still lost money in a down market. Rimm hurt me badly.  I spilled a little blood today in copper.

I’m still in a state of total confusion regarding the markets.  I’m always guilty of paying too much and selling it too cheap.  I did that today, and wasn’t even greedy. 

I felt a profound sense of relief after covering all of my shorts in CFC, as that was my biggest risk.  As it was, by 11AM, I was short a total of 110,000 shares of CFC.  I had to cover it because my risk management system kicked in and told me to cover.  I always obey my system.

My grain spreads all cooperated nicely, and I made an average of 3/4 cent on the total size of my position.

Even though today was emotionally exhausting, I ended up on the plus side, which is a good thing.

Jeff

Today

I don’t have a clue about what the market is going to do today.  My plan is to leave on my grain spreads, watch Countrywide(CFC), and scalp stocks and indexes. I’m so confused about the direction of the markets in general, except for the grains.  That being said, technical and fundamental analysis doesn’t make you money, getting in there and actually buying and selling is what makes you money. My friend Allocator might be right when he says this possibility of a bear market might be an all or none proposition.Jeff

Deschamps

Here’s a floral by Deschamps, a little known artist. I bought this way back in 1977 for $130.00

Jeff

My surfboard quiver

Here’s a few of my surfboards, the ones I actually ride.  I have more in the garage, more in the living room, and more in the corner of our dining room.  I’m bullish on surfboards, as the collectables market for boards is sizzling hot right now.

What a day

I quit trading today, right after the grains closed. When I saw the opening numbers in the S&P, I immediately sold my puts.  I gave back a lot of money on those puts(yet still made money), and didn’t want the trade to affect my thinking.  I immediately put that put money into selling more spreads in corn, wheat, and beans.  I legged on the bean spread, buying November,o8 first. My plan was to sell May on any rallies or strength.  I saw strength and was able to capture a real wide spread.  I pulled 4 cents out of the beans by the close. My wheat spreads were easy, as there was a not much wheat for sale, and prices were up on big volume.  I put on my corn spread in one chunk.  That’s why I like the corn market…you can sell a couple of million bushels in one whack, and only move the market a quarter cent.  Those corn guys have deep pockets, that’s for sure.  Although corn is boring, anyone with an IQ of 60 or above should be able to make a decent profit all of the time if they’re careful.  After I put on my spreads, I started selling some more Countrywide, (CFC). I sold it on the market strength, hell the S&P was up 20 points, and CFC was up 6 cents.  I sold a nice block of CFC after I hit the bid on an uptick.  CFC’s  down ~ $o.10-$0.21 right now, while the DJIA is up 320 points  I’m so short Countrywide that it hurts. That stock is such a dog, in fact it’s paper won’t be worth using as a bird cage liner down the road.  My average price is so over the market that I could withstand a $7.00 rally and still make decent money on the trade.

 As far as general market conditions are concerned, except for the grains, I’m in a state of total confusion.  I know the reasons for these moves, but I don’t know the extent of what’s happening.  Oil is shaking out the longs, and I don’t know how low the oil will go, so I’m totally wary of that market right now.  The sudden rally in the stocks, made me sell puts and give away 1/2 of my profits.  If I were smart, I would probably be buying more puts.  I’m confused with the dollar’s direction right now.  It’s consolidated it’s value here for the past few days, and I don’t know if a spike against the Euro is imminent.  There will be short covering, that’s for sure, the question is when.

 I’m pretty confused about interest rates right now.  I don’t have a clue, and my crystal ball is cloudy.  I’m staying totally out of the bond market, either side.  The spreads are too tight as the curve remains messed up.  There’s no easy money in the bond market right now.

I expected this slump in gold, but don’t have a clue on how far it will go, how long it will last,, or if we’ve passed the  top of the market and it’s in full scale retreat.  I’m staying out of metals until I get a handle the trend.

In fact, I think I will stay out of everything, save my short CFC, and my huge grain spreads.  I’m really maxed out on the size of my trades because I hit the maximum limit of contracts a speculative individual can put on for his own account.  Oh well, all of my grain positions are spreads, so I’ll sleep well at night.

I need to buy a grain elevator.  All of my big boy grain buddies own one and are able to use the elevator to open a hedging account and exceed the legal limits, legally.  Of course, those guys don’t do much hedging, but they use the elevator to put on 2000-3000 contracts in a day.  They spread it all, and make good money on the carry. 

I’m looking at the numbers right now, and my eyes are starting to glaze over.  It’s probably time to relax awhile and keep an eye on my spreads, and on CFC.  I might, or might not take tomorrow off.

Today was a good day, profit wise.  I covered my puts and spent the cash(although less cash than if I covered them two days ago) on grains.  I got maxed out in the grains(which is a good thing).  I stayed away from copper, which is also a good thing.

Jeff

Bad Day

I got nailed on my put options, and took a pretty good hit on my paper profits.  However, my stops didn’t get hit and I’m still short.  With this big up day in the market, Countrywide(CFC) only went up $0.33 which clearly put in the dog house as far as i’m concerned.  I’m intrigued by the sell off in oil today.  Oil took a big hit, and is shaking out the weak longs.  There’s a lot of guys who bought at $96 and thought they’d pull out an easy $4.00/bbl after it crossed the buck.  I envision a lot more pain before oil finally makes it’s move…..one way or the other.

The dollar is still on my radar.  I might buy some in the next couple of weeks.  With this 100% bearishness in the dollar, some kind of pop is to be expected.

I put on some huge seasonal grain spreads today.  We’ll see how it goes.  Grain spreads are low risk, low margin, and easy to manage.  They can be rather profitable if one is right.  I know a lot of people who make an excellent 7 figure income every year just playing the seasonal spreads.  I don’t usually pull 7 figures out of the spreads, but my batting average is very high in those types of spreads.

 Much to my chagrin, I’ve been looking at copper again.  Copper is my nemesis, and every time I want to trade it, I have to physically stop myself from doing it.  Copper owns me.

Countrywide Financial

As Countrywide(CFC) continues to implode, my account balance has grown steadily.  I was tempted to scale in some more shorts on CFC, but couldn’t find an entry point that suited me.

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 This stock  market is so sick. I don’t see any reason to buy it at this time.  In fact, we could easily see another 25% decline in equities.   This talkabout recession is worth another 1500 points off the DJIA.   I feel sorry for those who didn’t have the foresight to put  their 401-K’s into the money market instead of equities. 

 My trading account was up $166,989 and my equities account went down $11.5 K.  My hedging strategy has held up very well.

I moved all my stops.

I like being 100% right for a change.

Worst trade ever

I was trying to figure out my worst trade ever.  There are many trades that I could look at that were just plain old stupid, but this one takes the cake.  Back in 1987, I was BS’ing with some of my buddies at our favorite watering hole after the wheat market closed.  Around 2 or 2:30 PM, with a couple of stiff belts under me, we were talking about Pillsbury.  Pillsbury was in the news as a possible takeover candidate, but I didn’t think a deal would go through in the near future.  Since the options expired in two days, and the stock (PSY-old symbol) wasn’t looking all that good, I nonchalantly called my clearing broker (As I said, I had a few drinks in me by that time)and had them sell 100 PSY calls naked that were out of the money.  Those calls sold so fast, but my mind didn’t put 2+2 together.  I figured that I was good for making a couple of grand.  Anyways, to make a long story short, about 15 minutes after the close, Grand Met offered a $20.00 premium on PSY.  All I could do was say, ughhh.

The next morning, I bought back the calls, which were worth a whole lot more than I paid for them. 

I lost a few bucks on that trade.

I’ve lost a lot more money on other trades than I did on that call debacle, but this was me at my most stupid.

Jeff

Making my wife happy

As I’ve posted before, my lovely wife is in the hospital for some really serious, life threatening stuff.  She’s well taken care of, and that’s all that matters.  Yesterday, I brought her favorite drawing, a Van Loo, to be put at her bedside.  It cheered her up considerably as the Van Loo is quite exquisite..  I put the picture in with all of the flowers and nic-nacks on her bedside table. I just hope some nurse’s aide doesn’t grab it, as it’s quite valuable.  It’s quite small, only measuring roughly 3.5″X4.5″, so it probably will be safe.

Daily Kos

DailyKos won’t allow me to comment.  I wonder where the tolerence for opposing viewpoints has gone.

Jeff