A Hard Decision

It is obviously a hard decision. Is the economy really better, and can the market rise more, or is the FOMC being de-controlled, interest rates will rise, and a second stimulus needed? It was this that kept the market in a 50 point range again until 1.30 p.m, making it impossible to trade.

Yesterday we shared a tip on AOL, a stock we are buying in our Premium Blue Chip Option service (www.bluechipoptions.com), and today we'll share that we sold two positions, 1/3 of our holdings, in two Blue Chip holdings for 39% and 46.06%. The first trade I have worked with subscribers to trade in and out of 8 times profitably in 2009, and we still hold a sizable position for the long term.
The second stock we bought on break out, and it returned 46.-6% in 7 weeks, enough for me to take 1/3 of my profits.

We are "cleaning house" at Blue Chip Options, buying and selling to begin the year.

One of our most recent recommendations, and long term positions, is ExxonMobil. We've owned this for years, and just recommended it as a new buy. A day later XOM bought XTO Energy for 31 billion. There are two very positive situations here:

1. XOM is cash rich in investing in natural gas, and expansion.
2. Buffets recent purchase of 26 billion for a railroad, or Black and Decker, Comcast, Stanley Works: these are all mergers and acquisitions, and a flurry of activity always signals a return to busier days. If recent history is any guide, a rebound in M and A also is evidence the broader economy is going to heal. "Studies of the past two decades show deal making is largely a lagging indicator of economic growth, returning a few quarters after the economy bottoms, and slowly building as the stock market turns up and GDP and consumer spending return".

All good signs for economic growth long term.

Whether we have a Santa Claus Rally, or whether it's over, is yet to be seen. We'll recommend a new call trade tomorrow for a longer term hold, until volume and open interest return.



Important Personal Request from Floyd: In 2008 when our little service won the prestigious top 10 advisory services Readers Choice Award in prestigious Stocks and Commodities Magazine I was thrilled, and had reached a personal goal: to be better than the big guys and get rated.
Then, we won again in 2009. And here's where I need your help: I would love our company of Terry, Jenn, and Floyd to win again and we would appreciate your vote.

Head to : http://technical.traders.com/Products/ballot.asp. To vote you must be a subscriber to Stocks and Commodities Magazine, but any serious trader should be already.

Sign up and vote for us at one of the top 10 Advisory Services in the U..S., built out of self help and working with people off my home computer.
I'd be honored to have your vote.

To all OEX AND BCO Subscribers: Be sure to visit our blog spot today : http://www.bluechipoptions.com/ for several new stock tips