Long Nikkei And Short Yen.

I am having a great trading session. I was able to buy Nikkei futures near the morning`s low and really margined myself on the short Yen trade.

If the rally holds and extends itself, I am going to have one of the best trading session of this year.

I am also long Emini S&P Futures for a daytrade (I don`t have enough margin to carry them overnight).

September Seasonality. Downside Risks Looming.

Related ETFs: ProShares UltraShort S&P500 (ETF) (SDS), SPDR S&P 500 ETF (SPY), SPDR Dow Jones Industrial Average ETF (DIA), PowerShares QQQ Trust, Series 1 (ETF) (QQQQ) , ProShares UltraShort QQQ (ETF) (QID)

Negative Seasonality. Back To My Trading Desk.

The next 2 weeks have a pretty big negative seasonality. The week prior, and following Labor Day have historically been negative for stocks:

"For all 5-day periods over the last 20 years, the Dow has averaged a change of +0.15%. The average change for the Dow in the 5 days before Labor Day has been -0.54% over the last 20 years, which is pretty big underperformance. During the 4-day work week following Labor Day, the Dow has also averaged declines (-0.04%) over the last 20 years."

in Bespoke Investment Group

I am back to my trading desk and I am will take my time to re-adapt to the office, and to the markets. It won`t be difficult to start trading again, having the trading account very close to all time highs.

Have a great day.

Related ETFs: SPDR Dow Jones Industrial Average ETF (DIA), ProShares UltraShort S&P500 (ETF) (SDS) , SPDR S&P 500 ETF (SPY), iShares Russell 2000 Index (ETF) (IWM)

Rise Above The Crowd

"Bull markets are born on pessimism, grow on skepticism, mature on optimism, and die on euphoria. The time of maximum pessimism is the best time to buy, and the time of maximum optimism is the best time to sell.

If you want to have a better performance than the crowd, you must do things differently from the crowd."

Sir John Templeton

I will be back on my trading desk next monday. Markets are very active, there will be a lot of things to do.

Have a great trading day.

PS: Still playing the Nikkei, looking forward to add some more contracts later today; closed short Australian Dollar trade;

How To Become A Super Trader

"To be a super-trader, you'll need an edge to overcome the laws of probability and the uncertainty of the marketplace. That edge comes from information flow, the ability to correct your habits in terms of the market's characteristics, and being able to take risks, cut losses, expand your information network, ferret out ideas, and take recommendations."

Trading to Win, Ari Kiev

I am short Australian Dollars and long Nikkei Futures. Too many commitments for a vacation...

Soros And The Australian Dollar

"Volatility is greatest at turning points, diminishing as a new trend becomes established."

George Soros

I think there`s a lot of wisdom in this quote. And as you know, wisdom is a mixture of knowledge and experience. Soros surely knows a trick or two about trading.

I am having a great time with my family and I will only return from my summer vacation at the beach house next week. I am dividing my time between the swimming pool, the barbecue and playing with Enzo. Its great to watch him grow. He is 1 year old now, he walks (and runs) and is always asking us to play with him. I am having the time of my life.

I have been following the market from my IPhone, checking quotes once or twice a day. I placed a few fast trades from the swimming pool, shorting the Emini S&P`s after the terrible Initial Claims data from last Thursday. Markets will probably be under pressure in the next few weeks.

I am still waiting for the best time to pile into oil for a rally, but oil futures are getting cheaper every day. Check the Australian Dollar later today. The political turmoil in Australia will certainly hit its currency. Besides, we are in a risk averse market, which normally equates into falling high yielding currencies like the Australian Dollar.

I will try to post a small text daily to allow the members to follow the market live via the comments section. I read about a new member that is developing an oil trading system. That is great. Share some more with us, if you feel like it. Historical performance, time frame, trading style...

Oil Inventories Are Bearish. I Am Reducing My Position And Waiting For Direction.

Washington-based trade group American Petroleum Institute on Tuesday reported a surprise increase in oil and energy products inventories. The API said oil stockpiles increased by 5.86 million barrels on the week ended Aug. 13. Stocks of gasoline rose by 2 million, while stocks of distillates, which include diesel and heating oil, rose by another 2 million. Analysts polled by Platts had expected crude-oil inventories to decline by 2.25 million barrels in the latest week. The analysts also forecast a decline of 1.6 million barrels for gasoline stockpiles and an increase of 1.4 million barrels for inventories of distillates. More closely watched government data is scheduled for Wednesday at 10:30 a.m. Eastern.

I am reducing my position on oil futures after a rather disappointing session. Oil futures traded as high as 76.60 and reversed to end only marginally higher.

I will be watching the market action tomorrow to decide what to do.

Inconclusive Session. I Have A Bullish Bias.

I am still long oil and short 5 Year Treasuries Futures. I have even added to ZF futures today and I am playing a rebound on the Nikkei Index. Too many commitments for a vacation...

But I am only checking quotes twice a day, early in the morning and after the close. I am having a great time with my wife and Enzo.

If you want to have a good time, watch Le Dîner de Cons. Its the best movie comedy I have ever seen.

Long Oil. Eyeing The Nikkei.

I am long oil since last friday at around 75.70 and I am eyeing a long entry on the japanese Nikkei. I am still on vacations with my family at our beach house, but I am keeping an eye on the markets and looking for good trading opportunities.

The japanese index is trading at 9100-9200, a major support from last december. Last time it traded near these levels was on the Dubai sovereign debt crisis.

I also have a minor commitment shorting 5 Year Treasury Futures (code ZF). I will add further if it goes against me, but with 5 year yields at 1.40 I cannot see how it can go much lower then this. So, I am shorting the futures (they have an inverse relationship to yields).

So, I am playing for some swing moves and not for a few ticks.

I will leave you with a quote from Michael Marcus, "Every trader has strengths and weakness. Some are good holders of winners, but may hold their losers a little too long. Others may cut their winners a little short, but are quick to take their losses. As long as you stick to your own style, you get the good and bad in your own approach."

PS: Check the action on Cotton Futures, for a possible short term shorting opportunity

Oil Is Near Support. Should We Buy It For A 2-3 Day Rally?

I am bullish on oil long term, for the reasons I have expressed in prior posts. The trick is to buy at the right time, trying to avoid the inevitable drawdowns motivated from premature action. I am going to buy it in a downscale, trying not to be 100 percent right on my first commitment. I am giving it some room to avoid past mistakes of having the full position on too early.

Oil is trading near important short term support and I am considering buying it if it stabilizes in the next 24 hours.

Related ETFs: United States Oil Fund LP (ETF) (NYSE:USO), iPath S&P GSCI Crude Oil Total Return (NYSE:OIL), ProShares UltraShort DJ-UBS Crude Oi ETF (NYSE:SCO)

Have you enjoyed DJ Patife? Great sound isn`t it?

Try Arcade Fire, one of the best alternative rock bands.

Closed EUR/USD And I Am Back To A New High For The Year.

I have been lucky. I had a major EUR/USD short and I was getting hit pretty hard on the 8 consecutive week counter trend rally. I held, I have even added to the position at the later stages of the upmove and I was positioned to cash in if and when the cross reversed. Well, it has reversed a lot sooner then expected.

I was hoping to have my problem solved by the end of the summer, or by the end of my 3 week vacation... Well, I turned a big loser into a small winner and now I am poised fo a relaxing vacation. Unless something really appealing happens in the next few weeks, or I will be relaxing by the pool playing with Enzo without a care in the world.

Time will tell.

I am watching Lubrizol (LZ) for a 100 USD test. No position yet.

I had a few questions about SandRidge (SD) on the commenting section. Well, I was expecting to play it if the investing community got excited with the earnings release. It didn`t. They sold the stock pretty hard. Maybe its interesting now, but I am not commiting any capital to it. I am looking for healthier stocks, ready to move higher and not for tripling my money on a sick and battered stock. Not this time.

I will recommend you DJ Patife. Its my pick for this summer vacation.

US Dollar Rallying Again.

It nice to wake up, check the quotes while having breakfast and see the dollar rallying sharply. I was in a drawdown due to this Euro/dollar trade, but things are setting up for a complete reversal of fortunes. Patience paid, but I really had to sweat on this one.

I am a couple of dozen pips away from a new equity high. I may get a Moet & Chandon bottle for later today...

Have you noticed the sharp rally in US Treasuries? Pretty impressive. It will be a great short later in the year.

I am listening to Astor Piazzolla on my IPhone. It was a birthday gift from a friend of mine. Astor Piazzolla (March 11, 1921 – July 4, 1992) was an Argentine tango composer and bandoneón player. His oeuvre revolutionized the traditional tango into a new style termed nuevo tango, incorporating elements from jazz and classical music.

US Dollar Finally Showing Some Strength

After being beaten hard by the pervasive euro rally I am now feeling some relief. The US Dollar managed to finally rally for a couple of sessions in a row and I am now only 200 pips away from breakeven.

I am posting from the swimming pool, and I will go inside to watch the Fed statement live. But I am expecting further dollar strength. In between I have shorted Wheat after I read a comment here on yesterday`s post about a possible blow out top. I checked the chart, felt the same way and shorted. I closed a few minutes ago but it has probably ways to go on the downside. It was a 100 percent IPhone based trade from the swimming pool. It felt good.

Have a great day.

Another Call For Euro/Dollar Parity

“Parity is still going to happen. I don’t think the fundamental differences within the euro-zone have changed. I have a serious question as to whether the euro-zone can continue, at least in its current form.”

Shilling, president of economic research firm A. Gary Shilling & Co.

Enzo`s Birthday Party Was Great. I Am Taking A Vacation.

We really had a great time on Saturday. It was Enzo`s birthday party and we gathered a few dozen friends at the beach house. The weather was great, the food was great and was a fantastic way to start my holidays. I am taking a vacation, to relax and have a great time.

I will post a few thoughs and a few selected trading quotes from my IPhone, to allow the members to comment the daily price action.

I am out of all positions with the exception of the EURUSD. I simply could not close that trade and take the loss. I am expecting a few hundred pips snapback and then I will consider closing the trade. I am in a drawdown and that is upsetting me, as always. I hate to be in a drawdown, but I also must not play hard and make things even worse.

I will leave with a magnificent quote from Robert Rhea, "No profession requires more hard work, intelligence, patience, and mental discipline than successful speculation."

Stay tuned.

Is SandRidge Energy (SD) An Opportunity?

"I was seldom able to see an opportunity until it had ceased to be one."
- Mark Twain

The after hours reaction to the earnings release was inconclusive. SandRidge Energy (SD) managed to beat the street`s estimates for Q2 but they cut the production outlook for the second half of the year.

They will host a conference call before the opening bell. I am ready to add to my exploratory bet if investors like what they hear. This stock is very depressed, trading around 6 dollars per share compared to 15 USD in the last quarter of 2009.

They have acquired some onshore drilling operations and are balancing their exploration between natural gas and oil. They have an experienced CEO, co-founder of Chesapeake Energy (CHK) and the company`s biggest shareholder. Another bullish factor is that Fidelity has completely sold their stake (they were the second biggest shareholder), so they are not putting downside pressure on the stock anymore.

All in all, this stock may be poised to rally, but downtrending stocks are always difficult to play. They are almost always in a downbeat mood...

Euro Is Softer. Preparing Enzo`s Birthday Party.

Euro is finally a little softer and trading below 1.3200. Its been a rough trade, a loser from day 1.

I am still looking for opportunities to scalp oil futures, mostly on the long side and I managed to extract almost one full point per contract traded in yesterday`s session. It helped to contain the "Euro`s Spill". Maybe I will also need a "static kill" approach to that trade. I will give it a few more days to work out, and with the selling on the way up, I have an average price of 1.3020. I may still have a winner after all is said and done.

I am very interested in SandRidge Energy (SD) earnings that will come out later today. I have a small exploratory bet on SD and I plan to increase it if we have a green light from the earnings release. SandRidge Energy (SD) has been shifting natural gas production to onshore oil drilling and recently bought two land drilling companies. They will probably hugely benefit from the oil spill aftershocks and also from the rising natural gas prices. This stock was trading at 15 USd per share in the last quarter of 2009, and is trading around 6 USD now. If it starts to trade up again it has plenty of upside potential.

I am also trading in and out of Lubrizol (LZ). I think it will go through 100 USD very soon and once it does, it can go to 110-120 in a jifty.

I am taking a 3 week vacation starting Thursday, but I will keep posting, although with a bit less frequency. I will take my MacBook to the swimming pool, or I will post from my IPhone.

We are already in countdown to Enzo`s party on Saturday. We will host the party at our beach house and I will share some of the photos with you early next week. I bought him a battery motorcycle. I think he will love it.

Update, transcript from the commenting section: "I am shorting ZF Futures big time. Its probably the very long term top of this market. ADP Report will probably give a short term boost to this trade, lets see if it follows through"

I Spotted Two Opportunities. I Chose The Wrong One.

It was a rough session for my trading account. I spotted two opportunities, to go long dollars from a very oversold position and to play the 80 dollar oil breakout. I had a big commitment in the dollar trade so I decided not to play oil and it just blew past 80. I was even following it in real time if you care to read yesterday`s posts.

So I wasn`t reading the market so badly, I just got a little unlucky with my picks. I am in drawdown, the trader worst enemy.

I am keeping my dollar trade, and I bought a small line in SandRidge Energy (SD) and in Lubrizol (LZ). I have two different reasons for these trades. I am bullish on SandRidge Energy (SD) because its very depressed and being an onshore driller, I think it will benefit in coming months from the drilling ban.

Regarding Lubrizol (LZ), its the classic Livermore`s 100 dollar stock magnet. It will make 100 dollars per share in the next few sessions and benefit from the lack of overhead resistance to trade all the way up to 115 or 120. I am going in that train.

I will leave you with another beauty:

Oil Is Testing 80 Dollars Per Barrel

Oil is moving up towards the top end of its recent trading range. I am still bullish on oil, and I expect it to trade up to the mid-eighties soon. I closed my long position on oil futures last Friday because I have a major commitment on the US Dollar and I do not want to deviate my attention from that.

Its August and the summer trading is at its peak.

I am busy preparing Enzo`s first birthday. It was the fastest year of my life.

I will leave you with Alan Greenspan`s quotes over the weekend, "We're in a pause in a recovery, a modest recovery but a pause in the modest recovery feels like a quasi-recession" and when asked if another recession was possible,"It is possible if home prices go down. Home prices as best we can judge have really flattened out in the last year."

Related ETFs: United States Oil Fund LP (ETF) (NYSE:USO) and iPath S&P GSCI Crude Oil Total Return (NYSE:OIL)