The RO Report, "Extinction" Edition

I bet things were going pretty well for the Dinosaurs right before the meteor hit. I bet they didn't even see it coming.

Well, today was kind of like that for me. The meteor was FAS. Ironically enough, this was the same stock I profiled as a "good trade" earlier today.

I got blasted fighting the market between 1:30 and 2 as FAS cratered in my face. I blew out 20 cents from the bottom. I had a lot. Painful? Yes. However, I feel okay. I'm not losing my mind or anything, I feel money is coming. A setback to be sure, but I'm gonna go over it all tonight and master it.

Unfortunately, you know the policy around here... I lose money, I have to post bad music. I lost big money today... so prepare for a truly awful song to drop later.

On the bright side, the RO had a decent day. Nothing great, but solid numbers. Out of 29 traders, 19 were gross positive, or 66%. 5 traders made over $1,000 gross and 2 lost over $1,000 gross. I was Chambermaid, hopefully for the first and last time.

"Lucky Pierre" - Trader Z, $2,576 on 113k shares traded.

2. Trader 10*, $2,301 on 400 shares traded.
3. Trader F, $1,870 on 64,800 shares traded.
4. Trader 9*, $1,757 on 300 shares traded.
5. Trader N, $1,512 on 114k shares traded.

"Chambermaid" - Trader S, -$5,814 on 88,600 shares traded.

2. Trader B, -$4,533 on 217k shares traded.
3. Trader 6*, -$941 on 0 shares traded.
4. Trader V, -$884 on 69,200 shares traded.
5. Trader T, -$802 on 11,000 shares traded.

A Dry Joke, Courtesy Of Dinosaur Trader

I put peanut butter in a mouse trap this weekend. Five mice died from salmonella poisoning.

A Trade In FAS

I started Friday in a very bearish frame of mind. I ended Friday marveling at the market's resilience.

Accordingly, I began Friday getting short developing markets via purchasing EEV, the double short emerging markets ETF. I focused on EEV early because I saw that Brazil and Russia were getting pounded. I have no idea if that's a valid reason to purchase EEV. Anyway, the point is that this trade nearly killed me. I lost a decent amount in it and was forced to reconsider my bearish mindset.

A trading buddy/thorn in my side pointed out that SPY had held 80 support. At around 11am, when we vaulted through SPY 82 on some bogus news about unemployment benefits no longer being taxed (HAH!) he advised getting long. However, how could I buy into that spike? So I decided to wait for a pullback.



Above you see a chart for SPY, which is what I was following to time my entries and exits. After that initial large spike, the market consolidated and tightened up, and SPY set up for a triple-top break just after 1pm. However, I only had a very small SPY position. Instead, I focused my long efforts on FAS (triple financial long... HAHA!) because I noticed it was breaking the downtrend on the 60-min graph. See below.



I was hoping for a more explosive break. But whatever, what made this trade good for me was the way I held and purchased on pullbacks. As long as uptrend didn't break, my plan was to continue adding on dips. My thought was that as long as it broke above the 60 min downtrend and held, that I was safe to add with the overall market rising. So I purchased FAS between the prices of $8.44 and $8.80, building a position of 5,000 shares which I exited an an average profit of 17 cents per share. So I made about $800 on the trade.

I actually got very lucky, as the trade came within a penny of my "pain threshold." But I'll take it... I can't tell you how many times in my career that I've been stopped out a penny or two below my level only to see the stock reverse and go in my favor.

Long time readers know about my early struggles with the hybrid market. My old trading strategy of trading many stocks at once, is somewhat dead because the market is just too fast and illiquid in many stocks now for my taste. I used to take many trades and just "cut losers and let winners run." It's just much more difficult to do this with any precision now given the liquidity issues on the hybrid. Stocks will trade through levels on a 100 share trade, and then shoot right back above it like it never mattered. So, going forward, I'll be looking to put on more trades like FAS, in which I pick a direction for the market and build into one to five names.

That's not to say you still can't trade many stocks at once. I know a few guys who do this very well. However, in order to do so, you need to widen your stop loss levels. I'm not really comfortable with that. When I learned to trade (10 years ago in March, sheesh) losing a quarter point on a trade was a big deal. Now a quarter point is static. But for me, old habits die hard... and so I've had to reduce my exposure to static... it was stressing me out too much.

But hey, if in a month the market rewards trading 25 stocks at a time again, I'll try and be there.

Bartiromo Interviews Prince Alwaleed

This is great.

(h/t "the Fly")

Meanwhile, a lone voice cries out that Dennis Kneale Is Not An Idiot.

Low, "Words"

The RO Report, "Mettle" Edition

Seriously, why shouldn't the market be dropping? The banks are destroyed. People are taking dudes who live on boats and store grains seriously... but still, the market is hanging in there.

I went bearish when the SPY cut through 85 like butter. However, if we open Monday, blow through 84 and test 85 again, I'll start to wonder about the short side.

I'm surprised by this mild strength. Of course, it's kind of lame to think we're doing well just because we're not cascading lower, but I think that just points out how negative sentiment is right now. It feels like the world should be ending, but it isn't... yet.

The RO had an impressive amount of traders in the green today, but no one made big size. Out of 31 traders, 24 were gross positive, or 77%. 8 traders made over $1,000 gross and 1 trader lost over $1,000 gross. Pretty solid. I was #7 of 31.

Have a great weekend. Next week this blog will be chock full of posts.

"Lucky Pierre" - Trader D, $9,083 on 162k shares traded.

2. Trader H*, $5,770 on 8,800 shares traded.
3. Trader F, $3,328 on 94,100 shares traded.
4. Trader E, $2,872 on 32,600 shares traded.
5. Trader M*, $2,470 on 0 shares traded.

"Chambermaid" - Trader B, -$9,952 on 549k shares traded.

2. Trader P, -$789 on 80,400 shares traded.
3. Trader I, -$636 on 62,000 shares traded.
4. Trader 12, -$90 on 15,400 shares traded.
5. Trader 3, -$41 on 26,800 shares traded.

(Note, Trader 12 found the RO through this blog. Wish him well.)



Click here for Brian's take.

Linkday

- Which 3 traders from the RO are pictured here?

John Thain spent 1.2 million to redecorate his fucking office. Here's a list of some of the more egregious items. How about $35k for a toilet?

Exclusive footage of "the Fly" at his block party in Staten Island.

Ray parses the new Neil Young song in which he takes shots at Wall Street. Is Neil Young a hypocrite though or what? I mean, here he is cashing in on the bailout while complaining about rich dudes...

New conspiracy theory... despite loads of anecdotal evidence, Americans aren't dumb. Instead, Europeans just set up pictures on the Internet of dumb Europeans and call them Americans.

The HCPG guys are posting to their blog again. Like animals, actually... Here they post a transcript of a recent Warren Buffett interview. They wish "out loud," that there were more men in the world like Buffett. My guess, they really just wish there were more men in the world...

Howard complains about the cost of the Obama inauguration and draws my ire. Actually, Howard, it had nothing to do with the inauguration thing... I just hate the phrase "Color me ____"

More ire was drawn this week when Henry Blodgett described his plan to save the NY Times. James Surowiecki disagreed. Actually, I'm just posting this link because I want to be hired by the New Yorker. Quick, everyone click on James Surowiecki name NOW! Okay, Mr. Surowiecki, now that I have your attention... SAVE ME! I'm a stock trader but I want to live on a farm in Maine and write about the dawn and the sound that loons make swimming on dark empty ponds. Email me dude. Thx.

But look, if Surowiecki won't help me out, perhaps Jon Stewart will. In fact, if I had a half hour to live and the choice between watching The Daily Show or reading The New Yorker, I'd pick watching The Daily Show. Okay, quick! Everyone click on Jon Stewart's name NOW! Mr. Stewart, how's it going? Look, SAVE ME! I'm a stock trader, I run a third-tier blog, but what I really want to do is live in NYC and poke fun at politicians that I hate! Email me dude. Thx.

A neat list of where all that TARP money went.

Rick Sanchez tears "Joe the Plumber" a new one.

But before you start thinking I like Rick Sanchez, let me share with you one of my favorite video clips ever... "Do it!"

You're a racist.

Diane Sawyer got a little wasted at the inauguration.

I am a member of the Wolfpak, I admit...

Trader X is revamping his blogroll. In an effort to "guilt him" into including me on his, I will link him here.

Okay, that's it. I know I engaged in lots of "third-tier" behavior this week (especially in this post, sheesh!) and didn't write one history or around the house piece and I apologize. Just know that next week will be the best week ever here. I already have an around the house post set to go for Thursday and a history post nearly complete for Wednesday.

Don't miss them. Because soon, when I'm a writer for The New Yorker/The Daily Show, you'll be able to say you knew me back when I was "third-tier."

Animal Collective, "My Girls"

The RO Report, "Confusion" Edition

I think today was pretty difficult.

Sure we had a nice dive this morning, but I had a tough time padding my account during it. Instead, it gave me a nice short bias going into the afternoon which nearly killed me around 2pm when the market squeezed hard.

After two days of nice clean trending closes, today was a rude awakening. Just more proof that you constantly have to switch up your game. What worked yesterday doesn't necessarily work today.

So I don't have a great read on the market going forward. I look at the SPY chart and feel like we're forming a bear flag and will soon break 80, but enough smart people see some bullish divergences that it's giving me pause. Hopefully tomorrow clarifies the picture a bit. I'd like to go into the weekend with my sanity and my finances intact.

Anyway, it was a mixed day in the RO. Trader B nearly reversed all of his gains from yesterday, which couldn't have been pleasant, and no one really cleaned up.

The best you can say about the RO performance today is that most people managed to stay somewhat green. Out of 31 traders today, 21 were gross positive, or 68%. 8 traders made over $1,000 gross, and 4 lost over $1,000 gross. I was #13 of 31. Underperforming, but happy to come out of the day alive.

"Chambermaid" - Trader B, -$35,070 on 635k shares traded.

2. Trader 9*, -$2,072 on 7,100 shares traded.
3. Trader I, -$1,236 on 3,000 shares traded.
4. Trader 6*, -$1,105 on 300 shares traded.
5. Trader O, -$776 on 31,600 shares traded.

"Lucky Pierre" - Trader F, $3,284 on 63,100 shares traded.

2. Trader D, $2,905 on 131k shares traded.
3. Trader A, $2,126 on 258k shares traded.
4. Trader Z, $2,032 on 329k shares traded.
5. Trader J, $1,909 on 75,000 shares traded.

Aflac In Pain

Look for the Aflac duck at your local Chinese restaurant soon!

"Cubicle Boss"

This video is hilarious. Again, another reason to be a trader, no deranged boss.

Pixies, "Head On"

The RO Report, "We're BACK!" Edition

After a few choppy weeks to begin the year, it appears that the good times are back.

The RO kicked ass today, demolishing all other prop firms in the process. Take a look around you tomorrow when you go to trade at your "third-tier" shop. See those guys? A bunch of losers they are. We've got all the winners over here... it's almost unfair.

Of course, it helps that the market broke out at around 1:30 and never looked back. Nice clean closes these past couple of days, reminiscent of the autumn. We were afraid they were gone forever. I'm sure some of the guys in your office did okay too...

Anyway, you know how I like to talk about perspective. If you got some perspective these last couple of weeks, cherish it... If you've made a little money these last couple of days, respect it...

Always remember that your job isn't only to make money, but to be in control of your emotions and expectations. The good times come and go, as do the bad. Always remember, this too will pass... so, after that speech, we will humbly accept (granted, I talked a little smack) these gains and see what tomorrow brings.

Out of 29 traders today, 25 were gross positive, or 86%. 17 traders made over $1,000 gross and only 2 lost over $1,000. Nice, solid numbers. I was #12 of 29. Underperforming, but okay with that, since I had some awful overnight positions that I had to overcome.

"Lucky Pierre" - Trader B, $40,983 on 911k shares traded.

2. Trader Z, $27,577 on 380k shares traded.
3. Trader F, $16,770 on 262k shares traded.
4. Trader C, $11,165 on 405k shares traded.
5. Trader N, $9,409 on 166k shares traded.

"Chambermaid" - Trader 7, -$2,293 on 32,000 shares traded.

2. Trader D, -$2,024 on 286k shares traded.
3. Trader I, -$676 on 12,200 shares traded.
4. Trader T, -$127 on 7,600 shares traded.
5. Trader U*, $2 on 0 shares traded.

Brian's take...

The Daily Show On The Inauguration

Since I'm way behind in my writing responsibilities right now, I figured I'd toss up some "old school" Dino fare.

The Daily Show With Jon StewartM - Th 11p / 10c

Changefest '09 - Obama's Inauguration

Barack Obama Interview
John McCain Interview

Sarah Palin Video
Funny Election Video

Beta Band, "Dry The Rain" (Live)

Ushering in the new era. "Say it out loud, it'll be okay."

Meanwhile, if you don't know this song you will like it. Give it a listen.

The RO Report, "Croup" Edition

My daughter has picked up some 18th century illness. So, I am off to the doctor. The RO will be up later.

UPDATE: I always have a tough time the day after a 3 day weekend, and today was made even more questionable by the inauguration of Barack Obama. However traders enjoyed a real smooth move today, minus the chop from 12 to 2pm.

I always love a good, peaceful transition of power. Even if the Chief Justice garbled the oath... it was a great speech, and I think, glancing at C, and BAC that everyone must be rooting for Obama right now.

Not that he's here to fix the financial system... instead, I look at those stocks and see them as symtomatic of a sick country that hasn't been treated properly. The country has been coughing like a sick dog for the last 8 years and no one has been doing their jobs to make it any better.

Time to move forward.

I'm not even sure what to say anymore. Rarely have I ever felt so certain that so many stocks were going straight to zero. Are we entering an era where money is meaningless? We're not yet at the November lows on the Dow, yet C and BAC are basically worthless... I'm slightly confused and very concerned by this action.

Nonetheless, the RO had a decent day. Probably one of the best days of the new year in fact. Sure, we have a few accounts to the downside, but the bottom 3 were all swing accounts.. active traders did okay today. Out of 30 traders today, 18 finished gross positive, or 60%. 11 traders made over $1,000 gross and 6 traders lost over $1,000. Not great numbers by any stretch, but an improvement. I was #6 of 30. Pretty pleased.

"Lucky Pierre" - Trader B, $12,728 on 414k shares traded.

2. Trader P, $8,378 on 103k shares traded.
3. Trader A, $6,096 on 302k shares traded.
4. Trader C, $4,410 on 116k shares traded.
5. Trader D, $3,247 on 190k shares traded.

"Chambermaid" - Trader H*, -$13,703 on 18,100 shares traded.

2. Trader 10*, -$6,849 on 7,000 shares traded.
3. Trader 9*, -$3,070 on 800 shares traded.
4. Trader I, -$2,588 on 49,800 shares traded.
5. Trader F, -$2,201 on 64,800 shares traded.

Goodbye Neocons!

Looking forward to the future for the first time in 8 years. The worst is behind us now.

I'm Slow

Interesting fact: It will take you 30-40 seconds to read this post, but it will take me 12 days to write it.

Anyway, we went away this weekend and instead of slaving away in front of my laptop to craft a history post, or to finish the multitude of around the house posts that I have partially finished, or to figure out how to get the ball rolling in the "book club," I hung out with my friends and family and spent some time cross-country skiing.

In short, I've fallen behind and besides the RO posts, I don't know what you can expect from this blog for the rest of the week.

We will see. Perhaps I will get a history post done, or maybe I'll discuss getting surrounded by barefoot "yoga people" while clinging to a Wizard of Oz lunchbox. The point is, I have lots of catching up to do around here. Patience.

Smashing Pumpkins, "Drown"

Congrats to Dinosister on leaving her old job and starting a new one.  Change is good.  Here's her song pick.  A surprisingly good one.

Linkday

Yep... he's still there...

A Russian professor predicts the USA is going to split. At least the Northeast joins the EU...

Ever been pissed about getting a parking ticket? You'll relate to this.

I love this story. Rich guy fakes own death, found buying Bud Light Lime.

You didn't miss episode 1 of "the Fly Show" did you?

Cornography.

Greening the ghetto. Save the world and poor people at the same time. Sign me up. No wait, I hate the world and poor people... forget it.

This was an easy article to miss, but man did it depress me. Turn off the TV and video games and start parenting again people.

Bernie Madoff rapping. Okay, maybe the dude just looks exactly like him...

The Reformed Broker hates the bailout and Cafe Metro hates him.

Toyota wins again! They beat the Big 3 to hybrid, and now they'll get electric too.

Buy local and organic... buy local and organic...

Another reason to trade... no boss to kill you with a trident!

It didn't feel like it yesterday, but is volatility about to dry up?

I'm headed up to my mountain retreat for the long weekend. I'll try and get the RO report up, but no promises when. Trade well and stay warm.