What's Frank Thinking? rss
Chipotle - higher thanks to college kids?

 

Thursday, 07/24/14, Rhinelander, Wisconsin, USA
 
- Today is the 205th day of 2014 and the 34th day of summer. Happy Birthday to Jennifer Lopez. Today was the day of the "Pine Tar incident" in 1983, in which a two-run homer by Kansas City Royal George Brett was nullified by the umpires at Yankee Stadium due to "excessive pine tar" - for the third out in the ninth, giving the Yankees a 4 - 3 victory.
- The SPUs (/ESU4*), as of this writing, are trading up about 4 handles to 1984.75, about 20 points higher than last week at this juncture, and darn-near all time highs. That most important 2,000 level is now just a stone's throw away - will it be today? Tomorrow? How many STOP orders will there be at that whole number? Will there be more on the buy side to drive it well-through 2000 - at least for a few minutes? Remember, there is usually a day or two of big resistence at any large whole number, so be careful getting into any new long positions at this top! 
- Oil (/CLU4*) has been relatively flat most of the week and is now trading just under 103. We would still like it closer to 100 but over 97 for it's September option expiry. Gold (/GCQ4*) is lower this morning, but still hovering over the 1300 level - if barely. The yellow metal did have a 10 dollar range overnight (1295 - 1305), and a close well under-or-over that 1300 price might be a key to it's next direction. The 30-year bonds (/ZBU4) are lower and trading in the mid-138 handle, and after testing the 139 level a couple times this week we began to wonder if 140 isn't around the corner. We remember when they were 128 to begin the year and how long they strugged in the 134 - 135 range. Can they go any higher? Can interest rates go any lower? But we repeat... The grains, that had been reaching multi-year lows, are continuing to trade flat to a little higher. Corn (/ZCZ4*) did get into the 365 handle on Wednesday (7/23/14) but are currently trading 372. Natural Gas (/NGQ4) has been getting beaten down, after trading near 4.50 for months finally cracked under and remains under 4.00. The weekly EIA Inventory number comes out this afternoon, so there might be some movement in Natural Gas - if scalping it - pay attention at 9:30 AM Central time. 
- Chipotle Mexican Grill (CMG) was the big mover earlier in the week, and we might have found the key to it's move higher when asking our 20-year old heir-to-the-mortgage, who attends college in Portland, Oregon: "Blair, why do we see all the credit card charges at Chipotle, with all the great places to eat in Portland, why there?" "The food isn't the greatest, dad, but it's where all the girls from Concordia hang-out." Aha! Too bad we didn't get long on that anecdotal information on Monday! 
- Earnings announcements are really beginning to pick-up-pace, so look for those corporate action icons on your sheets to prepare yourself for some possible surprises, and there are also some key announcments coming today - beginning with Initial Jobless Claims and New Home Sales.
 
News events: 
Initial Jobless Claims
PMI Manufacturing Index Flash
Bloomberg Consumer Comfort Index
New Home Sales
EIA Natural Gas Inventory
Kansas City Fed Mfg Survey
Money Supply
Fed Balance Sheet
 
Notable earnings before Thursday's open:  AAL, ABC, ALK, ALXN, ARG, ASPS, BBW, BC, BCC, BHE, BKU, BMS, BMY, BPOP, BSX, CAB, CAM, CAT, CCE, CELG, CLF, CLFD, CLI, CMS, COG, CRI, CRY, CSH, CWEI, DAN, DFT, DGX, DHI, DLX, DNKN, DO, DPS, DST, ECA, EQM, EQT, F*, FAF, FLIR, GM*, GNTX, GPI, GPK, GRUB, HOT, HSY, IMAX, IMS, IQNT, ISSI, IVC, JAH, JBLU, KEM, KKR, LAZ, LLY, LTM, LUV, MHO, MMM, MTH, MTRN, NBL, NDAQ, NOK, NUE, NWE, O, ORI, OSTK, PCP, PDS, PENN, PHM, PNK, POT, PRLB, PTEN, QSII, RCI, RCL, RDWR, RS, RTIX, RTN, SCHL, SFE, SIAL, SQNS, SUI, SVU, SXC, TDY, TROW, TWI, UA, UAL, UFS, UNP, USG, VAC, VDSI, VIVO, WAB, WCC, WIT, WYN, ZMH;
and after today's close: ABAX, ACTG, ALGN, ALTR, AMZN, ATRC, AWAY, BAS, BCOV, BCR, BIDU, BJRI, BLDR, CB, CBI, CERN, CLS, COLM, CTCT, CYN, DECK, DGII, DLB, DTLK, ECHO, ELY, EPR, FET, FICO, FII, FLEX, FSL, GIMO, HBHC, IM, INFA, KLAC, LEG, LOGM, LSCC, MITK, MKTO, MLNX, MSCC, MTD, MTSN, MXIM, N, NR, NTGR, OLN, P, PACB, PEB, PFG, PFPT, QLGC, QLIK, RFMD, RGA, RGC, RSG, RVBD, SBAC, SBUX, SIVB, SPNC, SRCL, SWFT, SWI, SYA, TPX, TSRO, UHS, V, VR, VRSN, WOOF, WRE, WRI. 
 
"Adolescence - The stage between puberty and adultery." - Ambrose Bierce
 
Follow us on Twitter (TWTR): whatsfrankthink- like us on Facebook (FB*) - Frank Walsh Prescott, AZ  -- Look for us on Linkedin (LNKD)
The next Market Drive events will be in Los Angeles in November - go to www.tdameritrade.com/registerformarketdrive  
Tune in to the Swim Lesson Chat at 10:30 AM CDT - we will also see you in class. 
 
FHW
(* = FHW position) 
fhwoption@hotmail.com 
What's Frank Thinking? | 7/24/2014 7:55:54 AM | 0 Comments
Starbucks or Four Buck Chuck?

 

Wednesday, July 23, 2014, Rhinelander, Wisconsin, USA 
 
How about this reprint from this same time frame in 2007: 
 
"Two-buck Chuck? No, 3 bucks a cup - for acid reflux!" 
 
 "Over the course of the last few years, we have written many articles concerning various beverages. As we said in June of 2006: Not being "big" drinkers, as least since our crazy college days, we do, however, still enjoy, every-now-and-then, a good goblet of glorified grape, frosty stein of beer, or a small glass of fortified wine from Portugal's Douro Valley, known to most as Port." Touching on everything from $500 bottles of tequila, wines as wide-ranging as "Two-buck Chuck" to a nice Napa Cabernet from Silver Oak Cellars, beers like Negro Modelo, Budweiser and Wisconsin's - Leinenkugel, our daily missives have gladly gone the drinking distance and run the guzzling gamut. 
 We currently drink green tea in the mornings and "iced" with our lunch, but as the northern Wisconsin weather turns a little cooler, we are beginning to heat up at least our morning "sipper," and have even tried a warmed-over cup with dinner. But, up until the acidic properties in our daily coffee began to create some health problems, we were at least a three to four cup-a-day java enjoyer. Mud-like black at home and/or at least a "quad" latte at any of our favorite coffee houses, were our daily "perk-me-ups," and the price was usually of no concern. 
 There are 4 Starbuck's (now 8!) stores in our winter hometown of Prescott, Arizona, along with several other small coffee specialty operations. Until our acid malady of a few years ago, we would make a daily, early morning trip to our neighborhood Starbucks for a fresh "suped-up" latte, with sometimes as many as four extra shots of espresso. On warm days it might be a frothy Frapaccino or a Venti iced latte, but during most of the winter months, it was a steaming black coffee of the day or "skinny" (skim milk) hot latte. At just about any location and at every different dispenser of delicious "Jo," the cost for the instant blast of adrenaline would be between $2.50 and $5.00. And, yes, we were clearly "hooked," on the stuff, but thankfully a doctor's orders took the daily vice away. 
 Just about every stock/options investors knows the Starbucks story, from their first store in Seattle's Pike Place Market (1971), to it's current list of almost 9,000 outlets (now over 17,000), SBUX has continued to surprise just about everyone. Why the surprise? As we said, the cost for a "cup-of-jo" at just about every specialty coffee house is somewhere in the $3.00 range (now over $4), and with a flaky scone or bagel with cream cheese, it can get up to five, even six bucks. That seems pretty steep to us, but breakfast "out" is already a relatively expensive meal, when you consider most "combo" breakfast "deals" at fast food "joints" are between $3.50 and $5.00, and a real "sit-down first meal of the day" at a local diner will usually have at least a $10.00 tag. A restaurateur once told us, in fact, that breakfast has the highest percentage return per store in the industry, and he owned a chain of pancake houses. 
 But just how many consumers are willing to shell-out three-bucks-a-cup for some caffeine fusion? Statistics show, among coffee drinkers, that the average consumer drinks just over three cups a day. Are people really spending nearly 10 bucks a day on coffee? Specialty coffee stores now account for 10% of the $18 billion U.S. coffee market (2000), and their slice-of-the-pie is growing at about 20% a year. As of 2000 there were over 110,000,000 coffee consumers in the U.S., with the National Coffee Association claiming that a full 54% of the adult population drinks coffee daily, and that about 19% of these java junkies drink some form of "gourmet" coffee. Other interesting stats show that 65% of all coffee consumed is done at breakfast, which means that over 70 million cups are being brewed each-and-every morning and a total of over 400 million cups are enjoyed at some time during the day. 
 There will be an estimated 50,000 specialty coffee shops in the United States by the year 2010 (now closer to 70,000), and the average store sells between 200 and 400 cups per day. The U.S. imports over $4 billion worth of coffee every year from any of the 53 countries that grow coffee worldwide, and all of these lands lie along the equator between the tropic of Cancer and Capricorn. The world's largest coffee producer is Brazil with almost 4 million coffee trees, Columbia is second with about two-thirds of Brazil's production. The percolator was invented in 1827 by a Frenchman, and up until about the turn of the century, most coffee was brewed at home at a cost of pennies per week. Whew, at the current rate of three-bucks a cup, what you are really enjoying is a fresh brewed, mocha flavored blast of hyper coffee inflation. When we consider there are tens of millions of consumers sipping their expensive, spiffy, gourmet coffee every morning-noon-and-night, for some reason we begin to get that acid reflux feeling all over again." 
 
 "...on a clear day you can look through the windows and see as many as 6,000 coffee breaks at once.” -- Frederic Morton
 
Like us on Facebook (FB*) -- https://www.facebook.com/frank.walsh.169 or follow us on Twitter (TWTR) at whatsfrankthink or on Linkedin (LNKD) 
Also look for us in the daily Swim Lesson chat room from 10:30 - 1:30 central time, and at the Money Show in San Francisco in August or the Market Drive in LA in November.
 
FHW 
(* = FHW position)
fhwoption@hotmail.com
What's Frank Thinking? | 7/23/2014 7:11:41 AM | 0 Comments
Flying Burrito Brothers?

 

July 22, 2014, Rhinelander, Wisconsin, USA 
 
- Today is the 203rd day of 2014 and the 32nd day of the summer. On this day, in 1934, FBI agents shot and killed John Dillinger at Chicago's Biograph Theatre, we played softball some 40 years later for a tavern, Papa's lll, directly across the street! Happy Birthday to Don Henley from the Eagles - Is this "The End of the Innocence" or "The Heart of the Matter"? 
- The bonds (/ZBU4) are trading just over 138, a point higher than last week and two full handles higher than the week before. Oil (/CLU4*) is trading just over 103, and after threatening to drop under 100 last week, we don't know which way crude will go. We questioned last week if oil price could continue lower with all of the unrest in the world - guess we got our answer! Gold*(/GCQ4) has been stuck in the 1300 - 1325 range for a few weeks and is trading at 1306.50 as of this writing. The grains, corn (/ZCZ4*), wheat (/ZWU4) and soybeans (/ZSX4) continue to trade lower, with corn futures breaking under 400 last week and staying there. The emini (/ESU4*) SPUs are drifting higher this morning - trading about 1973, near their overnight highs and a few points higher than where they have been the last couple of weeks. Natural Gas (/NGQ4) is lower and it might be difficult for it to get back over 4.00 - 4.50, where it had been for months. 
- As the SPUs trade higher, many of the components are also looking up this morning, with Apple (AAPL*), Google (GOOG), Netflix (NFLX), Microsoft (MSFT*), Blackberry (BBRY*) and Facebook (FB*) all looking to open higher. Apple announced orders for 70 - 80 million of the new iPhone 6, a large uptick from the iPhone 5S and 5C, and Microsft touching 45 on Monday amazed most market mavens. The Flying Burrito Brothers was one of our favorite bands in the late '60s/early '70s, as the members came from the Byrds and led to the above mentioned Eagles. They were a great band but most famous for being the guys on stage when the fights broke out at the 1969 Altamont Free Concert. Well, the burritos must be flying over the counters at Chipotle Mexican Grill (CMG), as they beat their estimates and the stock is soaring as high as an eagle - up about $60! 
 
- Today's economic events:
ICSC Retail Store Sales
Consumer Price Index
Redbook Chain Store Sales
FHFA House Price Index
Existing Home Sales
Richmond Fed Mfg.
 
Notable earnings before Tuesday's opening: ABG, AMTD*, AOS, ARMH, ATI, BTU, CIT, CMCSA, CNC, COL, CS, CSL, DD, DFRG, DPZ, EDU, EXAS, FMER, GCI, HOG, HUB.B, IR, KMB, KO, LMT, LPT, LXK, MCD, MJN, MO, MOSY, NEOG, OMC, PII, PLD, RESI, RF, SAH, SBNY, SILC, SNV, STT, TRV, UTX, VZ, WAT, WRLD:
and after the close: AAPL*, ACC, ACE, BRCM, CBST, CVA, DFS, EA, EXP, FBC, FNB, FTI, FULT, HA, HTS, IEX, IRBT, ISRG, JNPR, LLTC, MANH, MSFT*, NBR, QDEL, RHI, TSS, UIS, VASC, VMW, XLNX, XOOM, ZIXI.
 
"It is not the mountain we conquer, but ourselves." -- Sir Edmund Hillary
 
- Like us on Facebook (FB*) -- https://www.facebook.com/frank.walsh.169 or follow on Twitter(TWTR) at whatsfrankthink, or on Linkedin (LNKD).
Look for us in the daily online Swim Lesson Chat Room - found up on Support/Chat on the thinkorswim (AMTD*) platform, and also remember the upcoming Money Show in 
 
San Francisco in August and the Market Drive in Los Angeles in November - see ya there. 
 
FHW
(* = FHW position)
fhwoption@hotmail.com 
What's Frank Thinking? | 7/22/2014 7:59:17 AM | 0 Comments
Marriage Theta decay?

 

Monday, July 21, 2014, Rhinelander, Wisconsin, USA 
 
Several years ago we told a friend, who was struggling-along in a difficult marriage, not to get a divorce - "just buy another house or two." Well, he took our sage advice, and constantly thanks us; as both the added real estate has up-ticked in value, and the relationship has also benefited from some up-ticks. Investing, to some, is also looked at as a relationship, and in some cases might be more stressful a financial one than a even a rocky marriage. But, do we have to be married to a stock forever, like we are supposed to be to our spouse? Yes, being tied to a stock (married) can sometimes be just as difficult as dealing with that "nagging wife" or "good-for-nothing husband", and pain is never very fruitful in any personal or investment relationship. 
 
We also followed our own above-mentioned advice, and own a few homes in a couple of states, along with a basket of stocks, all with both calls and puts sold against. The multiple homes have helped our marriage, and the sale of option premium has dramatically lowered the cost basis of our portfolio. We are also short several underyings, but haven't figured out a way to short a spouse. Too bad there isn't an exchange offering options on marriages or other relationships. Calendar spreads would be one way to go, as the volatility levels would certainly be all over the place. Relationship butterflies could pinpoint certain marital events. Naked strangles - well, we better not go there! Would we sell marriage call verticals or buy marriage put verticals - perhaps both! Divorce calls and puts could definitely be used as a hedge against some form of marriage inflation or deflation - whatever the case may be. And pairs trades - we better not go there either! 
 
"Only do what your heart tells you." -- Princess Diana 
"The most dangerous of all falsehoods is a slightly distorted truth." -- Georg Christoph Lichtenberg 
 
Follow us on Twitter (TWTR): whatsfrankthink, like us on Facebook (FB*) - Frank Walsh Prescott, AZ or on Linkedin (LNKD)
Join us in the daily Swim Lesson chat at 10:30 AM Central and come see us at the next Money Show in San Francisco (8/21 - 8/23) or Market Drive in Los Angeles (11/1).
FHW 
(* = FHW position)
fhwoption@hotmail.com
What's Frank Thinking? | 7/21/2014 7:02:37 AM | 0 Comments
Churchill - Volkswagen & Fiat?

 

Thursday, 07/17/14, Rhinelander, Wisconsin, USA
 
- Today is the 198th day of 2014 and the 27th day of summer. Disneyland opened in Anaheim, California on this day in 1955, and 20-years later the US and Soviets met in space when the Apollo and Soyuz spacecrafts were docked together. Birthdays: James Cagney (1899), Art Linkletter (1912), Phyllis Diller (1917). 
- The SPUs (/ESU4*), as of this writing, are trading down about 12 handles to 1963, but that is still 12 points higher than last week at this juncture. There has been some intraday movement in not only the S&Ps, but the RUT (/TFU4*), the metals, grains, and just about everything we follow have had some dramatic short term swings, but many are about where they were several weeks ago. Now do you see what we always say about summertime and why to try to avoid it like the plague? Had you simply sold stuff on both sides of the market (out to Augs and Septs) in May, you would still be sitting pretty as long as we continue to hover near these lofty levels. 
- Oil (/CLQ4*) has been a mover, however, after being in the 106 range a few weeks ago, it got down to 99 on Wednesday, but has rallied back to just over 102. 100 would be perfect for us, as long as it is still over 97 for the September option expiry. Gold (/GCQ4*) is higher this morning, and after hovering between 1280 - 1300 for weeks, had busted through all kinds of resistance points last week and looked like it was headed to 1350, but it too fell when all asset classes dropped on the Yellen speech on Wednesday when it touched 1292 - it is now trading over 1305. The 30-year bonds (/ZBU4) are higher and trading in the high-137 handle, just about where they were last week. The grains, that all had been reaching multi-year lows, have been trying to rally, but are mostly lower this morning. Natural Gas (/NGQ4) has been getting beaten down, after trading near 4.50 for months is now trying to hold over 4.00. The EIA Inventory number comes out this morning, so there might be some movement in Natural Gas - if scalping it - pay attention at 9:30 AM Central time. 
- Apple (AAPL*) looks flat to slightly lower, as do GOOG, TSLA, INTC and MSFT*. Speaking of MSFT and Intel - what the heck was "UP" with them yesterday? The market cap move was huge when you consider Intel's 5 Billion shares being up about $2 and Microsoft's 8 Billion being up about $1.50 - do the math! Wow! Blackberry (BBRY*) clearly didn't like the AAPL & IBM announcement, as that 11 dollar stock dropped about 10% of it's value, but there are only 500 million shares out, so it was well-surpassed in overall market cap movement by the large moves higher in MSFT and INTC. Will the Germans and the Italians really get together again? No not militarily, but Volkswagen (VLKAY) might be looking to buy Fiat (FIATY) in an attempt to gain greater access to the Fiat/Chrysler U.S. distribution chain. Where is Churchill when you need him? 
- Earnings announcements are really beginning to pick-up-pace, so look for those corporate action icons on your sheets to prepare yourself for some possible surprises. Make sure to check the MMM (Market Maker Move) for some idea of how much of a move the underlying MIGHT make.
- Tomorrow is July monthly expiration - anything In-The-Money (ITM) or close-to-it HAS TO BE DEALT WITH! If you dont know what to do, ask for help from the trade desk at 866 839 1100.
 
Another big day in news events: 
Housing Starts
Initial Jobless Claims
Philly Fed Business Outlook
EIA Natural Gas Inventory
Fed's Bullard: U.S. Economic Outlook and Monetary Policy
Money Supply
Fed Balance Sheet
 
Notable earnings before Thursday's open: ADS, AN, BAX, BHI, BX, CP, CY, DHR, DOV, FCFS, FCS, FITB, GWW, HLSS, KEY, MAT, MS, MTB, NEO, NTCT, NVS, ORB, PM, PPG, PVTB, SAP, SHW, SNA, SON, SYNT, TSM, TZOO, UNH, UTEK, WBS, WSO;
and after today's close: AMD*, ASBC, ATHN, BGS, CE, COF, CPHD, CYT, EFII, GOOG, GRT, IBM, PBCT, SLB, STX, SWKS, SYK, VMI, WAL.
 
“Never give in, never give in, never; never; never; never - in nothing, great or small, large or petty - never give in except to convictions of honor and good sense.” Winston Churchill 
“Mr. Attlee is a very modest man. Indeed he has a lot to be modest about.” -- Winston Churchill
“Lady Nancy Astor: 'Winston, if you were my husband, I'd poison your tea.'
Churchill: 'Nancy, if I were your husband, I'd drink it.'”  
 
Follow us on Twitter (TWTR): whatsfrankthink- like us on Facebook (FB*) - Frank Walsh Prescott, AZ  -- Look for us on Linkedin (LNKD)Tune in to the Swim Lesson Chat at 10:30 AM CDT - we will also see you in class. 
 
FHW
(* = FHW position) 
fhwoption@hotmail.com 
What's Frank Thinking? | 7/17/2014 7:41:39 AM | 0 Comments
JP Morgan or Janet Yellen?

 

Monthly expiration hump-day, July 16, 2014, Rhinelander, Wisconsin, USA 
 
"Thanks Janet" could be the new most popular phrase among market bears, as Ms. Yellen spoke on Tuesday Morning most asset classes dropped precipitously. The emini (/ESU4*) or as we call them, the SPUs, weren't thrilled with the Fed Chair, but either were the metals, grains, bonds, notes, or darn-near anything else we monitor. Gold had a crazy uptick in the early session, spiking up from 1300 to almost 1315 in seconds, but then suffered a sharp move to the downside, falling from 1306 to 1294 in an emphatic and dramatic heartbeat. In the same time frame literally every equity that we follow went from green to red, as all asset classes and sectors were driven lower. 
 
Gosh, we thought of J. P. Morgan, no not the bank (JPM) that reported strong earnings, but the man that once was even more powerful than our current Fed Chair person, as he almost single-handedly and consistently bailed out the U.S. banking system in the panics of the late 1800s and early 1900s. But our Fed Chair's power cannot be overlooked. The Continental Congress established our first currency, known as "Continentals", to finance the American Revolution, but they issued so many that inflation exploded and the early American citizens lost faith in what would become our dollar, coining, so to speak, the phrase "Not worth a continental" - meaning just about worthless. Our slightly different and possibly even less valuable current currency of today actually held up very well with yesterday's non-inflationary Fed prognostications. And the markets? Well, of course they shrugged it all off and rallied. 
 
The history of the Fed and both the early U.S. banking days is fraught with manipulation - both from the political side and the private banking side. Wars, inflation, depressions, market crashes, bank failures and other financial catastrophes have all been struggled through, yet survived. The incredible move higher in our equity markets since the most recent crisis (2008) may be feeling somewhat top-heavy, but overall our economy remains on stabile ground. If there is one thing that should worry everyone, it is debt and the credit markets. Are we digging a hole that can't be climbed-out-of from all sides? Individual, corportate, regional, state and federal debt is what we are most concerned with, and we don't know if Janet Yellen and the Fed will be able to fix that situation if it ever comes down to it. Too bad we can't call on the ghost of John Pierpont Morgan? 
 
"Bring in old man Otis." "Old man who?" "Otis, as in the elevator. He surely knows what goes up must come down." -- HUH and FHW (OEX pit circa 1985)
 
Like us on Facebook (FB*) -- https://www.facebook.com/frank.walsh.169 or follow us on Twitter (TWTR) at whatsfrankthink or on Linkedin (LNKD) 
And also look for us in the daily Swim Lesson chat room from 10:30 - 1:30 central time, strarring option guru Don Kaufman, chief market technician Jeff Bierman, and a host of other great thinkorswim kids from the Chicago office.
 
FHW 
(* = FHW position)
fhwoption@hotmail.com
What's Frank Thinking? | 7/16/2014 7:25:58 AM | 0 Comments
Retail and Yellen Tuesday.

 

The Ides of July, 2014, Rhinelander, Wisconsin, USA 
 
- Today is the 196th day of 2014 and the 25th day of this mostly higher stock market summer. Ford Motor (F*) took their 1st Model A order on this day in 1903, and the Nintendo game debuted in Japan on this day in 1983. Linda Ronstadt, Jesse Ventura and Forest Whitaker are all celebrating birthdays today. 
- Will the Ides of July be the beginning of the much anticipated sell-off in the overall market? If we dip, will it just be to 1900? 1800? On the other hand, we have those that are now calling for at least 2050 for the SPX by the end of the year - now only 6 months away. If you are invested for the long term, as you should be with a large percentage of your money - you shouldn't really care either way. Let the money flow in hopefully both directions over the short-term, that makes those of us who sell option premium all the happier. 
- The bonds (/ZBU4) are trading right on 137, a point higher than last week, but still in the range they have been for the last month. Oil (/CLQ4), which had been up to almost 107.50 a few weeks ago, and was 103 last Tuesday, is now precariously close to breaking the 100 level. Can the fall in oil prices continue with the unrest in the Middle East? Although, wait a second, that unrest has been around since camels were the "vehicle" of choice. So, who knows? Gold*(/GCQ4) has fallen from last week's 1325 level to just over 1300 - and thankfully our short futures positions were all covered yesterday. The grains, corn (/ZCZ4*), wheat (/ZWU4) and soybeans (/ZSX4) continue to trade lower, with corn now under the 400 level. Beans were 1125 last week - now 1080, while wheat has gone from 560 to 534 in the last week. 
-The emini (/ESU4*) SPUs are wrapped around unchanged this morning - trading about 1970 - exactly where they were last week at this time, as the summer's incredible cold weather (39 in Rhinelander this morning), seems to have added some molasses to the mix. AAPL* hit highs on Monday and looks to open slightly higher, while most of our other notables might open relatively flat. Retail numbers come out today, so if you have any positions in the recently whacked retail sector - pay attention. And Fed boss Yellen will present testimony at 9:00 this morning (Central time) - hopefully lending some hints as to interest rates and the general direction the Fed thinks the economy is headed - the SPUs might move dramatically while she is talking - so be careful if scalping any futures. 
- Today's economic events:
ICSC Retail Store Sales
Retail Sales
Import/Export Prices
Empire State Mfg Survey
Redbook Chain Store Sales
Business Inventories
Yellen delivers semi-annual monetary policy testimony
 
Notable earnings before Tuesday's opening: CBSH, CMA, GS, JBHT, JNJ, JPM, WWW:
and after the close: ADTN, AIR, CSX, CTAS, IBKR, INTC, YHOO.
 
"Any fool can make something complicated. It takes a genious to make it simple." -- Woodie Guthrie 
 
- Like us on Facebook (FB*) -- https://www.facebook.com/frank.walsh.169 or follow on Twitter(TWTR) at whatsfrankthink, or on Linkedin (LNKD).
Look for us in the daily online Swim Lesson Chat Room - found up on Support/Chat on the thinkorswim (AMTD*) platform, and also remember the upcoming Money Show Las Vegas in November - see ya there. 
 
FHW
(* = FHW position)
fhwoption@hotmail.com 
What's Frank Thinking? | 7/15/2014 7:27:49 AM | 0 Comments
"Bid up"?

 

Monday, July 14, 2014, Rhinelander, Wisconsin, USA 
 
July monthly expiration Monday - PAY ATTENTON! There has been some overall market movement (SPUs were 1920 on 6/16 - currently trading 1968), so some of your short July "stuff" might be In-The-Money (ITM) or close-to-it. Do NOT wait until the last second if your short July monthly is RIGHT ON THE MONEY, or relatively close to it. You never know if it will get this close again, and depending on the underlying, it might move well-off the necessary strike before Friday - like today! You could enter a roll or close or whatever adjustment you consistently make NOW, and hopefully you have already done so. If you always roll at a certain price, when the underlying is near the strike, why not ENTER THE ROLL AS EARLY AS POSSIBLE? This allows you to go fishing or golfing or to worry about some other problems, like if gold (/GCQ4*) will falter, or whether oil (/CLQ4*) and corn (/ZCZ4*) will rally? Anyway, this morning there are lots of equities looking to open higher - with AAPL*, GOOG, NFLX, FB*, BAC*, INTC*, TSLA, and SINA* all bid up. Be careful out there - remember to "roll 'em when you can, NOT when you have to." 
 
"C'mon guys - ain't there a bid for anything?" "I'd buy em, but there ain't a bid for anything." -- FHW & BAM (OEX pit circa 1987) 
 
Follow us on Twitter (TWTR): whatsfrankthink, like us on Facebook (FB*) - Frank Walsh Prescott, AZ or on Linkedin (LNKD)
FHW 
(* = FHW position)
fhwoption@hotmail.com
What's Frank Thinking? | 7/14/2014 7:16:35 AM | 0 Comments
Thursday - 1950 SPUs could be a key point.

 

Thursday, 07/10/14, Rhinelander, Wisconsin, USA
 
- Nikola Tesla was born on this date in 1856, as were Saul Bellow (1915), David Brinkley (1920), Arthur Ashe (1943), Virginia Wade (1945), Arlo Guthrie (1947), and Andre Dawson (1954). On July 10th, 1934, Carl Hubbell struck out Ruth, Gehrig and Foxx in the All-Star game and in 1965 the Rolling Stones hit "I Can't Get no Satisfaction" went #1. 
- The SPUs (/ESU4*), as of this writing, are trading around 1950, just about where they were two weeks ago (6/19) when we last penned our Thursday blog - looks like we didn't miss much in our week off. Huh? What? They did get up to new all-time highs just before the July 4th holiday (1978), and had we been paying attention, we probably would have shorted more of them, but our current position is still just fine - especially with this morning's sell-off. The 1950 level could be key.
- Oil (/CLQ4) was near the 106 level at that same two-week ago time frame, but despite the Middle East tensions has dropped dramatically and traded down to almost 101.50 overnight. Gold (/GCQ4*) is higher this morning, and after hovering between 1280 - 1300 for weeks, has busted through all kinds of resistance points - now trading over 1344. Gold being up 60 points in two weeks is indeed surprising. Does this mean inflation is right around the corner? Does the Fed announcement that they will stop their "easing" policy in October drive the markets lower and the metals higher? Gosh, if we only knew how low the SPUs could go and how high gold can run, it would make our life so much easier. But then, what fun would that be? 
- The 30-year bonds (/ZBU4) are higher and trading in the mid-137 handle, after being stuck near 136 for much of the last couple weeks. The dollar (/DXU4) is higher, while the grains, that all had been reaching multi-year lows, are trying to rally. Corn (/ZCZ4) is right on 400, which we thought might be support, until it traded 395 on Wednesday. The perfect midwest weather might make for record yields and we can't wait for the next crop report, as the grains tend to take ridiculous bounces - making for some great scalp opportunities. Natural Gas (/NGQ4) has been getting beaten down, after trading near 4.50 for months is now close to 4.15, and today's EIA Inventory number could make that futures contract move this afternoon. 
- Apple (AAPL*) looks to open down over a buck, and Google (GOOG), Blackberry (BBRY*), Microsoft (MSFT*), Netflix (NFLX), Facebook (FB*), Intel (INTC), Groupon (GRPN*), Delta (DAL*), Sunedison (SUNE*) and just about everything else we checked are also pointing to a lower opening. 
- Earnings announcements are really beginning to pick-up-pace, so look for those corporate action icons on your sheets to prepare yourself for some possible surprises. 
 
Another big day in news events: 
Chain Store Sales
Initial Jobless Claims
Wholesale Trade
EIA Natural Gas Inventory
Results of $13B, 30-Year Note Auction
Fed's George: Monetary Policy
Money Supply
Fed Balance Sheet
 
Notable earnings before Thursday's open: FDO, PGR;
and after today's close: CUDA, EOPN, PSMT, VOXX. 
 
"When we ask for advice, we are usually looking for an accomplice." -- Saul Bellow 
 
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Tune in to the Swim Lesson Chat at 10:30 AM CDT - we will also see you in class. 
 
FHW
(* = FHW position) 
fhwoption@hotmail.com 
What's Frank Thinking? | 7/10/2014 7:47:52 AM | 0 Comments
Puppy Love?

 

Wednesday, July 9, 2014, Rhinelander, Wisconsin, USA 
 
Most of you know that we are animal lovers and have had as many as twelve dogs in our home at one time. 12, as in a dozen? Is he nuts, you are now wondering? Well, yes and no. We did have twelve dogs, but no, we aren't nuts. We may be a little crazy, but who isn't? It's all relative, as insanity has a totally different definition from anyone to any other. How did we get on the subject of sanity? Oh, yah, our twelve dogs. Anyway, eight of those cute little critters were from a litter due to a "relationship" between two of our King Charles Cavalier Spaniels, Hank (King Henry of the Prescott Forest) and Lily (Queen Lilith of Antigo). Okay, we can hear it now - "do dogs have relationships"? We don't really know, but they definitely had something going in order to add eight beautiful little puppies to our family. 
 
We have actually figured the amount of money spent on our pets, and obviously, even bringing the puppies into the world in our own home (without a vet), the costs involved with our "best friends" have taken some dramatic swings over the last 60 years. In our youth it was mostly table scraps handed down to the long list of family pets, and a trip to the veterinarian was a rare event. My, my, my, how the domestic animal world has changed! Americans now spend over $55 billion a year on their pets, more than the Gross Domestic Product of 111 countries in the world. In fact, if the pet industry were tracked as a single entity, it would be the seventh largest retail segment in the country. Last year's $55.7 billion spent on pets was a record and was an increase of 44.6% since 2006. 
 
Food ($21.6 billion) accounted for the greatest expense in 2013, followed by veterinary care ($14.4 billion), supplies and medicine ($13.1 billion), grooming and boarding ($4.4 billion) and live animal purchases ($2.2 billion). We have been a big pet spender in all of those categories, but thankfully our eight puppies were sold at an average price of $1,500, so the recent costs were somewhat made more pet friendly, so to speak. Now, having only one remaining dog, our family's pet price has never been lower, and the dog chores have become minimal. As long as we can remember we have always had at least two dogs. Yes, the twelve was a short-term and rare event, but for most of the last 12 years we had four furry friends; and, as anyone animal lover will attest, we loved them all and considered them as family members more than anything else (hope you are reading this JJ). However, we are now down to our last little Cavalier Spaniel, Romeo (Prince Romeo of Antigo), and once he is gone, we might try to take a dog vacation. Just think of the money we will save!
 
"Whoever said you can't buy happiness forgot about little puppies." -- Gene Hill
"Not only is life a bitch, but it is always having puppies." - Adrienne Gusoff   
 
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host of other great thinkorswim kids from the Chicago office.
 
FHW 
(* = FHW position)
fhwoption@hotmail.com
What's Frank Thinking? | 7/9/2014 7:47:54 AM | 0 Comments