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Author: Mike Celeste Editor: Tony Ponzo April Circulation:

Stat Sheet Week Ending April 4th 2009

ChangesWeeklyMarch1st QuarterYear to Date
IndexesPointsPercentPointsPercentPointsPercentPointsPercent
Dow+242.0+3.1%+538.0+7.6%-1,175.0-13.4%-758.0-8.6%
S&P+26.0+3.2%+62.0+8.4%-106.0-11.7%-61.0-6.8%
NAS+77.0+5.0%+148.0+10.7%-51.0-3.2%+45.0+2.8%

Highlight of this past week: Both day trading strategies continue to win big. As of 4/05/09 the Indicator strategy now stands at 24 wins and 2 losses and the Momentum Strategy sits on over a 261% profit!

Special Note: We would like to welcome all the new members that have joined the team in the last few weeks. We have had a high volume of new members especially in the Indicator Strategy and we wish all new members, as well as our seasoned members, much success and enjoyment. For other newsletter readers who have been thinking of joining the team, click on these links to learn more about the Indicator Strategy or the Momentum Strategy.

In this Issue---
Options---
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We had some of our Basic Splitters with options hit our Call writing price this week. Now we can see if the stock gets called away and closed out, or if additional income can be picked up like a dividend. Our other Call writings are in the same position. With the strong market the stock prices are at or near the strike prices. While that means the Call goes up in price, it also means that our stock went up in price, so either way it is a good thing. If the stock prices hold to the upper levels above the strike price by expiration, we have the choice of buying back the Calls and then writing at a higher strike price, or we can let the stock go and search for more to write. If the stock is Called away, we can write naked Puts for those stocks that we would like to own - and they get Put to us if they dropped down to a desired strike level - much like we do for the Big Dipper strategy. Good option prices are out there. We'll have more writing of option ideas in future newsletters so don't forget to look for them each Saturday.

 Momentum Plays---
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For the week of Monday Mar. 30 through Friday April .03, we had 8 trades. There were five wins and three losses. But the three losses were small and the over all net profit for the week was very good. And for 2009 year to date, we still have a 78% win rate and an overall fantastic profit margin of over 261%. Again, we have to ask, where else can you find that kind of profit in this market - even with the rally of the last four weeks.

We added a section to the top of our past results in the Momentum Strategy that shows how much you could have made if you traded 16 contracts a trade and what could have been made on 32 contracts per trade. It is pretty impressive. Check it out at Past Results. And keep in mind that the numbers on the past result page are based mostly on conservative trading - meaning, getting out of trades when we hit a minimum profit target as opposed to hold for bigger profits. In some of the plays, in which bigger profits came quickly, we posted the bigger gains but for the most part the conservative profit goal is what is posted. Many of our more aggressive members often beat these numbers and in some cases, they beat the number substantially. And one of the best aspects of the Momentum Strategy is we are usually finished trading each day within the first two hours of the market. So it does not take a lot of time to follow. If you would like to learn more about this fun and winning day trading strategy with a conservative approach as one of our members points out, click on this link. Learn more.

Indicators---
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We only had one play this week on this strategy but it was a nice win. And talk about trading a winning strategy that takes a minimum amount of time, this strategy takes less than two hours a week (not a day). Usually we have two or three plays a week and for the year we have had 24 wins and only 2 losses for an amazing 92% win rate. As our lowest priced strategy, it makes sense for anyone interested in trading to give this strategy a try. Click on this link and Learn more.

Feedback---
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There was an interesting suggestion from one of our new team members, Noam (first name). We always like suggestions, and in this case we were able to implement better explanations regarding our Indicator Play right away. We agreed that his suggestion had a lot of merit. Other team members can see that the Indicator page on the web site has more information for them. Plus, we are now sending a morning reminder on the Indicator Strategy when we have a play thanks to Noam's suggestion. Thanks, Noam, and welcome aboard.

Sidelight--One of our new members comes from New South Wales, Australia. I hope he is still with us,(Just kidding!) as we had headlines in our paper that there have been a number of sightings of Great White Sharks around New South Wales.

The Economy, The Markets & Commentary---
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It was really something last week when the major indexes were up for the 3rd week in a row. That momentum hasn't changed, as we added a 4th week in a row to the list. This market does not want to go down. We even had 4 days in a row of up prices on the indexes, wiping out a large loss on Monday. There has been a drastic change in attitude on the part of investors. There is no sense in fighting the tape and that is an old saying that still holds true. Bad news is being ignored, such as employment figures. The excitement seems to be because the news isn't getting a lot worse. There is negative news, but it isn't as bad as it was before. This gives hope and anticipation that things are going to get better and that the real bad news is behind us. This is typical, as we have often mentioned before. Anticipation drives up expectations and prices, and it remains to be proven whether that will turn into real improvement. Just figuring that the bottom has been reached is enough to do the job right now. On the other hand, there is lots of news that indicates we are in for a long haul before things start to actually get better. Home sales improved and was a stimulant during the week, but the improvement was still a low figure. Our debt is causing a great debate about how and when we will be able to pay it back. It is also interesting to note that CNBC is now talking about the stock recovery prices compared to the highs of Oct. 2007. Before that we heard about prices compared to the beginning of the year, and how much of a percent it had dropped. March did its proverbial job, didn't it? In like a lion and out like a lamb---a ferocious start to the month, followed by good things as the month progressed (but don't tell that to the people in the upper Midwest, where they had blizzards and floods). April is supposed to bring showers, May spring flowers and June busts out all over. Nice thoughts and we are pulling for that to happen. We must keep our feet on the ground, tho, and not soar off into space. In our opinion the big jump in stock prices could well be a bit overdone. In the meantime, tho, we welcome the rise and we have been able to make money buying SPY Puts in the Indicator Strategy for some quick trades to the downside, like on Friday, where the market ended up nicely by the end of the day. And then making some money on the upside, too. In and out--that's what we like during these kinds of markets, and we don't care which direction it is going. We apply the strategy for ups or downs---and we'll let the long term investors hold on for dear life. We feel day-trading is the way to go, and also writing options for extra money for those stocks we are holding for better buy prices or sells on the upside, and those trades we hold for just a few weeks.

There is still a lot of furor over bonuses paid to the people that helped cause our financial crisis. What it hasn't touched is the politicians who aided the greedy financial people in making those outrageous mortgages available on 100% loans and no proof of income. There is also a spilling over of outrage into the executive pay area, where the high ups got extremely rich on amounts that defied history. The old scale of CEO pay to regular workers was 50-1. It has grown to become a ratio of 350-400 to 1. I don't know about you, but it seems to me that everyone should benefit when the company does well, and executives, especially, should not be given pay increases when their actions end up with the company doing poorly.

Most of those that caused this mess are already gone, with golden parachutes carrying them off into the sunset, richer than most of us could ever imagine. One of them, tho, is facing fraud charges for cooking the books on options for himself. The ex-KBH Home chief, Bruce Karatz was in the news this past week He pulled in $232 million in compensation in just 3 years---with to one FBI agent saying it illustrates "avarice and dishonesty at its core." There are honest ways to become wealthy like that if that is what one wants to do - through well laid out plans, hard work and patience. A great example of this is with Warren Buffett. We're talking dollar figures none of us will most likely ever see (but, hey, Warren Buffet did it with good financial planning. Maybe some of our SplitMaster team members will compound profits to that level--if it happened before it can happen again!)

Scam of the week---
This week we saw a report about an insurance scam that is getting increasingly popular. People are burning their cars for insurance money. It's especially hard to sell SUV's and cars in general, so they commit arson and burn them for the insurance money. No sooner had that report come out than our LA Times reported that a member of the Los Angeles Police Dept. has been charged with that exact crime. He apparently was heavily in debt and allegedly took that step to try to help his situation.

 Today's Thought---
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Be like a postage stamp. Stick to one thing until you get there..........Josh Billings

Mike

Note---My hometown, Binghamton, NY has been on all the news channels as I am writing this. A madman killed 13 people and then himself in a Civic Association building there. People were studying to become citizens of the US and had classes there. My very good friend works for the nearby Catholic Charities and the TV said the hostages were taken there after they were released, so their relatives could pick them up. She said that she feels privileged to be able to help them. (I have nice friends) and she doesn't know when they will get to leave, there are so many. I'm very proud of her.

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