Saturday, May 9, 2009

Lovely Saturday morning

The impeccable Koolau Mountains to the left. Diamond Head to the right. Well, if I could see through concrete walls, that's where I am.

Busy lately, as busy as ever, but not so much with lots of stuff as much as studying certain things like prep sports and the market. But what's equally interesting -- and sometimes painful -- is realizing that the biggest asset and detriment is myself. That's what the market always teaches: balance requires discipline, and that's always been one of my, uhhh, well it's never been a huge strength. Except for those springs and summers and falls when I diligently went to the park to work on my handles and pull-up jumpers.

Miles Ogawa was quite a teacher for me. He didn't coach me once I was done playing JV basketball, but his teaching/coaching stayed with me and I shared the zeal he had about defensive positioning and technique. His 60-shot drill stayed with me on those quiet afternoons at Ala Wai Park.

Anyway, Coach Miles was one of the very best. Thanks Coach!

I don't consider myself an athlete by any means, nor do I consider myself an athlete in the market, where most of us small fries are just trying to pick and choose our way to profitability. Learning to cut losses early and not just often, but ALWAYS, is a never ending challenge. It goes against some of my natural tendencies, like sticking it out when things get tough (perseverance). Bagholding a stock is not perseverance, though. It's stupidity and it can be costly.

I'm currently bagholding LVS and DNDN. I believe strongly that both will continue to rise and that there's no need to sell until then. I took a big hit in the past month on DNDN (should've sold quickly after it leaped to 28) and decided to sell at break-even after having a huge paper profit, then got back in, didn't sell while it was up and now it's down a few bucks; I also took a hit on BAC after earnings when it gapped down in the morning from near 11 to about 8-9. Instead of holding, I decided to get out. That was driven by fear, and apparently I was wrong to unload. BAC is now at 14.

Point is, this market rewards the good pickers and those who tune out just about everything in the media. It also rewards those who are disciplined and don't overpay at peak levels unless there is a catalyst. Example would be RIMM, which blasted through earnings estimates; recent numbers show the BlackBerry outsold the iPhone in Q1. RIMM won't come back down to 70 unless there's turmoil on Planet Earth, so it's up near 80 for some time to come. It's worth investing in on pullbacks.

Whatever the stock, though, a game plan is absolutely necessary. Sell on a slight dip and preserve your capital for lower buy-ins/better prices, or just wait it out like I should have with BAC. I did wait it out on BAC once. That took two weeks to recover, but it felt like two years.

I will continue to approach with a long-term outlook/hold on certain stocks (AAPL) and position trade on others. The bottom line, though, is whether I apply the game plan and get out of position trade losses ASAP. This past week was a personal record for break-even short-term trades, small-loss trades. That allowed me to be profitable for the week. Continuing to learn and focus on discipline: speed and commitment as a result of planning. A mix of break-evens, small losses and a few big gainers each week will equal profitability. I'm content to break even and that's a major step forward in my thinking.

See Trader Mike for some very solid reading.

Monday, May 4, 2009

Oracle effect

Wells Fargo was told, supposedly, to clean up its balance sheet by the Fed. The stock rockets.

I don't get it, but who cares? If you own WFC, you're stoked. From 19 to 20 to 23 in a couple of days?

Bulls run wild

S&P 500 closed at 907.24, above that magical 903.25 threshold. Dow up 214, Nas up 44. Positive housing numbers fueled it, plus Obama's speech about eliminating loopholes for corporations that take jobs overseas.

I did a little of everything. Held core positions in LVS, AAPL (small but growing), debated whether to sell DRYS (I held) and F (I held). Traded some LVS for a gain twice. It was so hot, would've been better off letting it run. Closed at 9.50. Amazing. Felt like black jack dealers were dealing the stock all day. Best profits in awhile, but still cautious about losing paper profits.

Used some discipline, not chasing much at all today. Would love to catch LVS and DRYS on a pullback tomorrow. Market has to breathe sooner or later.

Saturday, May 2, 2009

Looking at specs

Maybe Fortress (FIG) and KFN aren't really the typical penny stocks. Or were. I deferred (punted) after looking on Friday after hours. Should be a pullback on Monday after crazy gains Friday (28 and 30 percent), but they may be all right for quick trades at some point for those of us who missed the initial run.

FIG was on Fast Money, when Guy Adami mentioned it. Said it was interesting here, even after the run up. Karen Finerman mentioned/pimped her KFN. My love-hate relationship with financials isn't completely over, I guess.

Looking at longs

A few more charts of some favorite core holdings.

Solars heat up, wind next?

Top solar stocks were up roughly 7 percent last week. Is it time for a run? Only if you think the Secretary of Energy is a catalyst. Stephen Chu announced a $93 million funding deal, but it's for wind energy. Alternative is alternative, in a sense. Worth watching. One of my favorites, STP, hit 15 last week. I had it at 13.

LVS at pivotal point

Las Vegas Sands. Debt. Gambling. Overage (buildout). However you describe it, LVS is true to its DNA. They risk big, win big, lose big. Quite awhile back, I took a look and found that LVS was interesting but not attractive. That was about $100 ago.

Now, even after rising from an all-time low of 1.38 to a recent intraday high of 9.05, it's a risk. Not everything has been resolved, though I tend to think LVS will bounce back strong. Just a hunch. It'll be a long, long time before the stock returns to 120. For now, resistance at 9 is a thick ceiling. If and when LVS busts through, it has to take out 16.81. Then it might be off to the races.

For anyone who bought below 5, you're sitting pretty, I think. I got in a little at 5.77, sold at 6.95, forgetting that Guy Adami had handicapped LVS to hit 8.00-8.50. Now that LVS is at 8.00, it could sell off again and get buyers a better price. Then again, it's sold off since hitting 9.05 on Thursday.

Never took a close look at WYNN or MGM. Why? I never stayed there. My only trip to Vegas, I was put in the Venetian (work-related conference). That stuck.

I'm long LVS just a bit and may add if it dips to 7ish. Holding for 10. Maybe 16.80. Possibly 50.

The Oracle still loving his WFC

He's consistent, if anything.

I gave up my WFC shares several weeks ago. Yeah, bought in around 14, sold around 14, and the very next morning, Wells Fargo surprised the world with an early earnings announcement that sent shares to 19 instantly.

Anyway, the reason I bought the shares in the first place was that Warren Buffett was very bullish on WFC, that it would handle its derivatives well and profit enormously from them. As of yesterday, he's saying the same thing, though his Berkshire Hathaway shares are running red recently.

I'm not about to get into WFC again, but the way Buffett hypes WFC and USB, it's hard not to think twice and do a little homework at the very least.

Friday, May 1, 2009

Cramer says Nasdaq CEO on next week

A caller from Oklahoma asked Cramer to find out what the hell happened with that shady situation on Tuesday when DNDN was screwed over. Cramer says it looks like someone tried to "paint the tape" and that he'd get the Nasdaq CEO on air to get some straight answers because "he's a straight guy."

Yeah right. Bernie Madoff's disciples are straight shooters. Really? I'm not optimistic that Nas will uncover the bullcrap.