EOT position update July 23, 2014

| July 23, 2014

July 23, 2014

Market Snapshot

Over the last few weeks, violence has erupted around the world.

It’s horrible to see the death and destruction being caused by the fighting in Gaza and Ukraine.  The commercial jet that was shot down over Ukraine is a senseless tragedy.

The spotlight is now centered on these geopolitical events.  And it has created some volatility in the global financial markets.  Obviously, the headline risk will remain elevated until the conflicts in Gaza and Ukraine calm down.

The good news is there are hopes of a cease fire in the two conflicts.  And investors seem to be taking an optimistic view that these situations won’t get worse before they get better.

One thing that’s helping to revive optimism among investors is corporate earnings.

The second quarter earnings season has started with a bang.  According to Bespoke, the early quarterly earnings data is the best in nearly four years.

As a result, we’ve seen the S&P 500 climb back to an all-time high today.  The large cap index is now just 12 points away from 2,000… a psychological resistance level that I’m keeping a close eye on.

For now, earnings and upbeat economic data have the upper hand.  If this continues, the S&P 500 should make a run at 2,000 in short order.

I’m working on a new trade… keep an eye out for the trade alert in the next few days.

Let’s move onto the updates…

Position Updates

Just a quick note:  Remember, we won’t update every open position every week.  I try to focus on the positions that have some significant news or price movement.

P August 2014 $30 Calls
P has been moving steadily higher over the last week.  The company reports earnings after the markets close tomorrow.  This will be the ‘make or break’ moment for this trade.  If they have successfully defended their market share from the competition, P should make a nice move to the upside post-earnings.  Continue holding but be prepared to close this position following the earnings announcement.  Resistance is at $32.00 and $36.00.  Support is at $24.00 and $22.50.

TPLM October 2014 $12.50 Calls
TPLM has been on the upswing after the buyout of fellow Bakken oil & gas company,Kodiak Oil & Gas (KOG).  This is just the leading edge of the merger and acquisition activity I expect to see in the industry this year.  TPLM is a very attractive takeover target for a large energy company looking to expand into the Bakken.  Continue holding… Resistance is at $14.00 and $17.50.  Support is at $10.75 and $10.00.

HIMX September 2014 $7 Calls
HIMX continues to drift lower as the bears press their advantage.  But there has been little, if any, in the way of real news from HIMX lately.  But there will be lots of information to digest over the next month.  The company reports earnings on August 7th and they will hold their annual general meeting on August 27th. Unless something unexpected happens, we’ll need to wait for these events to see HIMX’s stock price move.  Continue holding… Support is at $5.75 and $5.00.  Resistance is at $9.00 and $11.00.

Category: EOT Update

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