Your Car is Going to Zero (Part II)

Thu Oct 2, 2008 9:58pm EST 10

Fly had an excellent post today explaining reasons to short Auto companies. If the house does not pass this bailout you can kiss your these companies goodbye. Going through Fly’s list tonight, I must say it is super ugly for the industry.

Here are a few names at critical points:

AutoNation, Inc. [[AN]] Short below 10.75

AmeriCredit Corp. [[ACF]] Short below 9.50

Advance Auto Parts, Inc. [[AAP]] Short below 38.00

[[CRMT]] Short below 17.50

Copart, Inc. [[CPRT]] Short below 37.50

Cummins Inc. [[CMI]] Short below 37.85

Note: These are the new financials, should the bailout not go as planned, you will want to be familiar with these names.

Comments »

FCX: Bought @ 46.75

Thu Oct 2, 2008 11:21am EST 22

Back in Freeport-McMoRan Copper & Gold Inc. [[FCX]] , enough is enough.

On a day like today I had to buy at least one stock. It was out of FCX, National-Oilwell Varco, Inc. [[NOV]] , or Chesapeake Energy Corporation [[CHK]] .

They are giving these companies away.

Note: Also picked up some Gushan Environmental Energy Limited [[GU]] @ $4.00

Comments »

I Want Money (IWM)

Thu Oct 2, 2008 1:58am EST 13

For those unfamiliar with [[IWM]] , get familiar.

IWM seeks investment results that correspond generally to the price and yield performance of the Russell 2000. The Index measures the performance of the small-capitalization sector.

The beauty of this ETF is that you can trade it using options (very liquid options), and they also trade 15 minutes after the close.

Keeping things simple around here, I will focus my trading on IWM for the next few days. As you can see from the chart below we are a critical point in the index– it’s “bounce or die.”

(click to enlarge)

I think a great way to play this is to open a strangle position, then wait to see if support is held or broken, and close out the respective leg. Also, if we do head below $65, buy more puts.

No one has a clue where we are headed, so use the option strategy to ease your mind– and help you profit.

___________________

“I Want Money (IWM)”

[youtube:http://www.youtube.com/watch?v=-tyk4PoTFzk 450 300]

Comments »

Waiting

Wed Oct 1, 2008 2:16pm EST 10

..for the real fun to begin.

I’ve done little today, scalped a few trades here and there, but nothing to write about. Tomorrow we get to see if they let us short financials again– that will be interesting.

My position is cash, if I make a trade, you can believe it will be closed out before the days over. I’ve lost too much money holding positions overnight. September 2008 was, by far, my worst month physically, mentally, & financially– I’m glad it’s over.

– Chart Toppers

– Bull & Bear Radar

– Nervous Markets

Comments »