As we stated in our morning call there is a lot of pent up buying pressure in these markets and today they got to let off some steam. We finally got a couple of the catalysts we needed to bring the buyers back to the market. We felt that having a portfolio that was skewed to the long side was the smart thing to do in this oversold environment, and today we made up for a lot of lost ground. We are still short-term bullish on the market, and hopefully we can string another positive day tomorrow. The overseas markets should feed on our performance and a carry through would not be out of the question.
ExactStockPicks Portfolio Update
We had a little bit of action today in the portfolio to say the least. We closed out two positions today. Qwest Software (QSFT) was stopped out today at at break even. We had held the stock for too long and the technical formation which we entered on was long gone. This one was whipsawing with no real direction. Sometimes you just have to say you were wrong and get out of a bad play. Luckily, we did it with no loss.
Along those same lines was Baidu (BIDU). The chart no longer supported our excitement for this issue. It had assumed a Jekyll & Hyde persona, and we don’t like musicals. It had a tremendous run today of over 7%. We figured that was good enough a reason as any to exit. We made a slight profit on the trade.
It’s not always about winning big. You have to be disciplined and manage your risk, or you will be filleted in these markets!
Our Union Pacific June 72.50 call had a nice run today. It is now in the money. One more nice positive day on this stock and we will pull the proverbial double-play. Making money on the stock as well as the option. Does the strategy start to make sense yet?
Overstock.com (OSTK) had a real nice run today. We are up over 8% since we entered this stock a couple of days ago.
June 2010 Recap
6/1/10: Sold short 100 shares Union Pacific @ $71.96
6/4/10: Bought to cover 100 shares Union Pacific @ $69.68
Profit – $228
6/2/10: Sold short 200 shares Thoratec Corp @ $44.00
6/4/10: Bought to cover 200 shares Thoratec Corp @ $42.70
Profit – $260
5/27/10: Sold short 200 shares Jinpan Intl Ltd @ $15.83
6/07/10: Bought to cover 200 shares Jinpan Intl Ltd @ $15.14
Profit – $138
5/25/10: Bought 100 shares ConocoPhillips @ $49.00
6/10/10: Sold 100 shares ConocoPhillips @ $52.57
Profit – $357
5/24/10: Bought 100 shares of Baidu @ $72.18
6/10/10: Sold 100 shares of Baidu @ $72.32
Profit – $14
5/20/10: Bought 200 shares Quest Software @ $18.75
6/10/10: Sold 200 shares of Quest Software @ $18.75
Profit – 0
Total June Profit to Date: $997
Trade Idea for the Day
Baidu, Inc. (BIDU) has a phrenetic trading style. It is an easy stock to trade if you can read its mood. With an up market today this stock gained back nearly 8% of its losses it has had in the last couple of trading sessions. With the market up considerably today we took a short position at the close. We coupled this with a protective June 72 call option. We always protect our positions against major loss while allowing substantial gains.
