Oh Happy Days

Let's lead off with some subscriber commentary/testimonial. Trader DP recently lost big bucks on his holding only puts, and not playing the calls. He's a seasoned trader that kept his hope with his opinion, not with "no matter what" watch the market breathe. Here's what he wrote me yesterday:

"Floyd,
What advantage of sitting on sideline, I didn't play anything this morning.

However, I learned one more lesson - Never get married to 'MOB - my own bias":-)
Flow with the stream and get ready to switch gears, which I do in my IT profession, but not in trading. Looks like these bulls wants to go to 1044 (S&P) before Aug Option Expiration, again just my thoughts...
Let see what afternoon bring us...

Thanks,
DP"


"Floyd, it's been an incredible run of calls for me, including yesterday, and I've lost now on three puts. I've followed the rules straight through, and not jumped for massive profits, just taken advantage of the market bias. Thanks for the teaching on emotions, and 'sum of parts'"-LVD, Georgia

"
Floyd,

My attention has been away from trading for several months These are my welcome home results..On closing 8/10 I purchased the 465 put for $8.10 and sold for $12.40 before noon central time 8/11 for a 53% return.I also brought the 465 call for $4.70. Sold 1/2 for $5.20.

Thanks for all your time and energy.

Kevin"


Next, a few facts to help us understand "oh happy days' of the FOMC: "A RECOVERY ONLY A STATISTICIAN CAN LOVE"

Traders enjoyed a great run up on the FOMC yesterday, Macy's earnings, and really nothing else. It's a market led by optimism, while more vigilante groups are gathering guns and our town hall meetings are a shamble of lies and "Rove" attempts at not recognizing facts.

The bottom line:

1. Traders were able to get into -OXBHM OEX.X AUG 2009 465.0000 CALL as low as 4.50 and sell to highs of 8.30 by 3 p.m. Entry at prior day close was easy, with the immediate market downturn. Calls were profitable for us once again.!!!

2. Traders that chose to "two way trade" were able to take entry to -OXBTK OEX.X AUG 2009 455.0000 PUT at an average two buy assumption at 2.75

3. The market repeatedly stopped at what Floyd calls a "breakline", a very strong resistance area that could easily run up another 100 points to our next Dow top. Note that there is also retracement often after the FOMC and a "negative rebound".