Year End Sell-Off For Tax Reasons

We’ve had so many slowly moving but upward days that the market closed at two-year highs this past week. Our trust call recommended Monday was available for tight profits each day of the week, always able to buy below prior day close.

Many traders ask when we give a buy price of say, $10.00, and the option closed at 11.90, do they wait until $10.00, and what happens if it never makes it.

Our “best buy” and sell recommendations are just that. Recommendations. These are AREAS to buy or sell in, and never exact. The core rules are set to apply under most market conditions, which are to never buy an index option at prior day close or higher, but always hold for a discount price. These will change only when we so notify in an alert because of a specific condition.

The last several weeks, after 44 plus successful trades in a row and only two losses, have been difficult to trade. The “trade range” has kept the market very tight in movement, with very little volatility, necessary for our really successfully trading the index options.

We expect light movement this coming week, and increasing movement in early January, in which the “first five days” are often considered the “telling tale for how the market will move” for the following year.

Over all conditions we are short term bullish, and believe the euphoric upturn will continue.

It takes a 239-point or greater overall downturn in a single day would shift the market. Many services use this character as a 200 plus move singularly in day shifts the bell curve, and create a new bias. Be careful to note that we’re at over 80 plus signals of upturn without a true “bear phase”.

The difference between a dramatic move that will shift the bell curve and a period of time in which the market corrects are vastly different and merely reflect a shift in correction for oversold or overbought conditions.

We are adjusting our Dow projections because of the lack of volume, holiday conditions, and the bell curve we see in the market.

Dow Projections

11,127-Market Pivot Point, lowest low. Doubtful

11,240-11,367-Former Resistance lines turning to support

11,430-Likely support bottom on any correction

11,550-Resistance

11,624-11,647-Resistance and Likely Tops to Market

At this area the market is truly overbought, and overextended.

This week will be both the “sell off” for tax reasons, cleaning house, and the “buying new” but the big moves have already been made. Volume will be light.

The economic calendar may have several trigger points:

http://www.bloomberg.com/markets/economic-calendar/

Puts still remain the weak string, so to both OEX and Blue Chip subscribers the bell curve count still shows upside.

Three Consecutive Weeks

The market has moved up for three consecutive weeks and we’ve hit new market highs several times, only to be held back by major resistance lines. And we now enter the Christmas week, with trading volume light. We will only trade through Wednesday, believing Friday to be very light volume or our final day to trade a signal.

Traders reported 5 successful .50 to .70 cents per contract profits last week on calls, two on puts, and most broke even on the signals with the light movement we saw in the slow grinding upward climb.

First the economic calendar:

http://noir.bloomberg.com/markets/ecalendar/index.html

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We live, trade and breath right now from FEAR. It pervades the world consciousness and is more of our energy than anytime I’ve seen in 60 years in life.

I read always with great interest about Wikileaks, as I believe more that the facts being released are both free speech, but alarming about what the idiots are doing that run our world. From a letter writer in a Florida paper:

Info- terrified

If WikiLeaks represents a new phase of info-warfare (or info-terror) leaving many of the world’s leaders with egg on their face, I’ll welcome this new development any day over bullets and napalm. (Catch Me, And I’ll Drop A Bomb of data, Assange Warns- Dec.6)

Those used to calling the shots and being in control instinctively understand that for them, the nub of the WikiLeaks problem is not that it’s releasing government or military “secrets.” That’s bad enough, but there’s a bigger concern, one with far more unsettling long-term implications: the populist, or is it anarchist? under current that’s driving WikiLeaks and similar websites and movements. They reflect the growing scorn and mistrust with which many ordinary people view our governing elites and their cronies.

The Internet and social media have profoundly changed the news and media industries. Now, these same forces are changing politics in ways our governing elites are beginning to see, but don’t yet fully understand.

The essence of democracy is an informed electorate, and so, while I have to wonder who appointed Julian Assange the guardian of knowledge and truth, I can only applaud the spirit of what he is doing, even if I don’t always applauds how he is doing it.

Ken Cuthbertson, Kingston, Ont.

Although Gold and Silver are both weakening we don’t see the top yet, and project upward movement on both metals at least until February 2011. WE have sold some of our precious metal positions recently near tops, but remain heavily invested in GLTR.

In actuality there is little going on in the market. We are seeing higher highs, but always a hold up near 11,550 area, the highest we’ve seen the market in two years.

We see crude oil continuing its upward climb only for the shortest term. Any drop below 88.10 may signify an oil decline. We have sold our Exxon calls, and a majority if not all of our Exxon position for hefty profits, but maintained our Chevron holdings.

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For a market dip and its potential, watch for any closings on the S&P below 1226; if the S&P does moves below 1200 we suggest the Dow will then hit its 10,000 area bottom support test. Cycles themselves are down until the end of the year.

We suggest light movement and thusly light profits on all open or new OEX option signals during that time period. Any order must include your knowledge that a larger second buy may occur.

For Blue Chip subscribers we have been taking profits, depending upon your financial risk and type of investment, on all holdings where we show 20% or more profits, and want to enter the year in more CASH than stock, except for our ongoing 15% minimum in precious metals and 30% in TIPS inflation bonds.

We continue in 90% of our stocks to only pick dividend paying stocks; our new higher rollers, such as SHZ, where we returned 50% in a few short weeks, or NENE where we returned 30%, only to buy again near the $2.00 range, waiting for more volatilty.

Economists and Wall Street strategists expect stocks in general to rise 10% next year, as an economic expansion takes hold. We agree with summation, as the GOP will now try to take credit for things “getting better”.

Recent “expert testimony” that is provided to hedge funds and money managers proves Floyd’s long term belief that the market is maniuplated, just as it was proven recently that Silver calls were manipulated by two brokerages over a two-three year period.

As this is an open dialogue to both services we will share with Blue Chip subscribers here to continue to hold the option positions:

-WMT LEAP

-PG LEAP

-SLV short term 3 month call

This is a bad sign: U.S. companies spent 92 billion on their own shares in the third quarter. Contrary to popular belief stock buy backs or splits do not influence the stock positively, in more cases than not.

Lastly the USD is less valuable, at least in trading. China’s currency is emerging now in Global foreign exchange markets.

During the week we will issue three new potential higher risk break out stock buys, in which volality will be high, and the risk higher. With this comes the risk that brings greater rewards.

Always Leave Some Money on the Table

We experimented with our OEX subscribers last week by providing two signals, a put and call, on Monday, and gave instructions on how to play both signals through the week, with no other new signals given.

We did this for three reasons:

1. We teach that the actual option that is chosen for index trading is secondary to how to buy , sell, and “learn” the option. This is called “falling in love with an option”, truly knowing its movement so well that you can anticipate the bid/ask and what the traders will trade as they try to profit from one another.

2. Our basic set of instructions for the week was set to teach the trader how to follow specific directions, or not to trade.

3. To teach our use of the “count” or bell curve around the Dow Projections and support and resistance lines to take tight profits even in a range bound market.

During the week Floyd received testimonials and updates from Level 2, Level 3 and Advanced Mentoring clients. The results should be of interest to you.

Using 73 email inquiries, averaged:

-No losses

-An average of 9 gains on the call of .50 to .80 per contract.

-An average of 5 gains on the put of .60 per contract.

This was “tight” trade range trading in a market almost unable to trade with the tight range the market was in.

We will be repeating this approach this week for index option traders, and as you receive your separate alert make note our goal is to “trade the edges” and if the market does trade range, how to have buys and sells always in, and work for tight profits.

The commentary to OEX traders above teaches our Blue Chip Option subscribers our approach to focusing in on “the few, not the many”.

Options and new stock trades that hit the money for us this past week:

RIMM Call- up to 46% profits, SOLD

CAT Call, up to 50% profits, SOLD

SHZ-new stock, up 50% in one week. Not sold, or if done so sold by 1/3’s

We remain deep in the mud on our REE January call but are not pulling the plug.

Our friend , Alan Austin, who recommended several of our positions, is studying the rare earth sector well and finds new break out stocks or options often.

We added to our WMT LEAP call on dips, and will continue to. We also continue to add to our PG LEAP call on any dips, and will continue to buy this position.

We believe both Gold and Silver are soon hitting short term tops, and recommend to all “traders” of Gold, Silver, etc. to take profits. For those traders holding inventory for the long term Glitter, or GLTZ, remains a balanced hedge of the 4 top precious metals.

Gold will still hit $2000 and up by the end of 2011, and Silver even higher ratios, or our recommendations to sell some of our positions is to always use our maxim

ALWAYS LEAVE SOME MONEY ON THE TABLE

Lower Cost and Better Education

I’ve had many emails from my lengthy commentary last Monday where I combined the resources of OEX Options and Blue Chip Options for the MONDAY commentary only.

I remind all subscribers again that alerts for the OEX and Blue Chip continue daily through the week, just holding less daily commentary, and listing what we are trading. With Blue Chip if we are not trading we do not issue an alert.

CC, a valued long-term subscriber, has asked that we improve our www.stockcharts.com public listing to show current recommendations. We will do so this weekend, but make note that many of our positions are CORE and we do not trade, we only buy and hold, and tell you only when updates, and many of the charts are for your general review about the market. In our Advanced Mentoring service http://www.oexoptions.com/AdvancedMentoring/AM.html

We teach distinctly how to utilize PNF charting as we do in Level 3 in our movies.

First an opinion from someone with common sense. This is NOT a pee party member; they are too busy watching the “truth” on Fox News or listening to Rush, the great Barnum hustler.

“ I am no economist, but having recently arrived in your country to work, manage and live. Let me at least propose four ways to help this slowly recovering economy:

1. To those who can afford it: Go spend money. For the first time ever your past overconsumption will actually contribute to making things better

2. To perfectly healthy companies: Invest in the U.S. Invest in selling or manufacturing products that can be exported, or substituted for imported.

3. To banks: fulfill your basic mission statement: Lend-finance medium size healthy companies. Estimate the risk, charge a reasonable margin, and contribute to get us out of this mess your cohorts got us into.

4. To the Government: What are you still doing in Afghanistan? Get out, which will save billions (which will help you balance the budget) and start working on the three things the U.S. economy really needs to become competitive again:

· A lower cost of litigation

· A lower cost of health care

· A better education system

Frank De Haan

Dallas”

This letter explains it well. It’s the definition of “lower cost, or better education” that remains the issue.

Here’s the sad answer on Wikileaks and the morality of disclosure of secrets:

Any government that is phucking stupid enough to make their security system so bad that a 20-year-old Private that can’t even shave is able to hack it DESERVES their secrets known.

Does it affect the fate of people? Sure, just as we reading the incredible corruption and falsehoods the U.S. and other nations have been perpetrating.

Sorry, I can‘t fault Wikileaks. They operate from the Constitution (show this please to a Pee party member). You may not agree, but it is their right.

GLD, closing above 1389, appears to be on another BUY signal.

Silver (SLV) some believe will top at 30.85 and others believe will outlast the Gold run and actually move even higher.

We will be recommending a new Call option to Blue Chip Traders through the week

Blue Chip Traders in long or short term Treasuries take note. We are approaching another cycle low. We may see a low point and burst up, but our money on Treasuries remains in TIPS, as the world talks about deflation.

Many OEX traders wrote with the same three questions this past week:

1. Why would you trade calls on down days?

Answer: Whipsaw leads to best buy, and we made money all the time on the bounces

2. Your Dow projections are astoundingly accurate and often vary from many other professional traders that we brokerages buy? Why?

Answer: I use a combination of Point and Figure charting, Bollinger Bands, historical cycles and intuition. I do not read any other points of view by professional traders, with the exceptions of Charles Nenner Research and Key Turning Dates. I read only Bloomberg for news, and do not watch any talking heads. Intuition is fully 30% of my read.

3. Do you see a long term return to buying equities, and have any long-term projections for the market, or the Dow?

Answer: To me, if I can “see” 21 days” ahead for index trading options it’s as far as one should or could go. As for longer term I only follow trends that I think will break through sectors as the market rises and falls, and these become our long-term CORE investments.

We have seen enough volatility, and enough key reversals, that the market may be now in for a pre-Christmas ball buster drop to scare the world, which certainly needs scaring. However, there is more right than wrong economically, and our easing moves appear to be working.

As we are stretching at the top of Bollinger Bands, which have been contracting, we also see any downturn following the same Dow Projection cycle that we just completed.

Not One Damn Reason

There is not ONE DAMN REASON you should not be making LOTS of money in the stock market right now. Not one. All the ups and downs, and the massive swings, are horrible for the buy and hold investor, but can be incredibly profitable for the day and index option trader.

At www.oexoptions.com our 2010 average returns are 40.1%, and this includes taking all the brokerage commissions and even the cost of this subscription out.

In other words, if you had invested $50,000 through the year in any or all of our 340 signals that were provided you could have $72,050.

At www.bluechipoptions.clom we study stocks and stock options, our rate of return for 2010, again taking out all costs, has been 44% on stocks and 48% on options.

We won the prestigious Readers Choice Award with Stocks and Commodities Magazine as one of the top TEN ADVISORY services. There is no real better reference than actual traders telling us how we are doing.

· 60% of our subscribers are stock analysts or full time traders

· 20% of our subscribers are Certified Financial Planners that use our methodologies to round out portfolios.

The remaining 20% of subscribers are those investors that know you must study to do well at something, and that we are not promising “You CAN make a Million in one year”.

Instead we offer one on one mentoring with our lead trader, Floyd.

Of interest, in a bad economy last year, more subscribers signed up for our most unique psychology-based introspective mentoring service for learning to trade:

http://www.oexoptions.com/AdvancedMentoring/AM.html

Sale Price!!
http://www.oexoptions.com/pages/Level3_BCO-Annual-2400.html

We make one “sale price offer” per year, and limit our subscription base.

Join us for one year of Blue Chip and OEX Options Level 3, both services, for the hugely discounted price of $2400.00 annually. (Split into quarterly payments of $600.)

If at the end of one year you believe you have not succeeded or learned with our services, our parent corporation will refund any portion of your subscription that you feel fair.

That’s right. WE GUARANTEE THE YEAR. You have nothing to lose.

Subscribe Now!!
http://www.oexoptions.com/pages/Level3_BCO-Annual-2400.html

If you are afraid to risk money, you will never make it. If you risk money without training and logic, you will never make it.

Feel free to write me with questions at: info@oexoptions.com for a personal reply.

This offer is only good until February 15^TH, 2011

YOU ARE WHAT YOU DECIDE

Upside Continues

The market went right to our top resistance line, a very bullish sign and the Dec535C, for those still holding partials, hit highs of 11.40 by 2 p.m.

Our rules are to never pay above prior day close, so we did not trade. With futures up so dramatically it was possible for traders following our system to buy up to 10% above prior day close, but even that was not possible.

We continue to see upside, following our Dow projections, and want to win every time, but are strict with our rules.

Simple Rule of Thumb

We saw the Dec 535 Call have both very negative and positive, and then day trades. Many subscribers wrote to tell me of two or three profits on this call, as the market tanked last week, and we saw the possibility of trading again. We profited again on 11/30, with lows of 5.70 to highs of 7.70. Tight $1.00 profits and up.

We are falling love with this option. Play it again trying to buy below prior day close, but following futures. We see likely upturn to 10,256 area

Remember this is how we are trading:

The OEX Simple Rule of Thumb Buy at S-2, Sell at R-2 Buy at R-2, Sell at S-2

Buy an option at Low Volatility And Sell it a High Volatility