The Oxen Report: Is It Just Me or Is This Market Starting to Look Toppy?

Short?? I thought it was a long call… lucky that I didn’t got X.

Oxen Alert – New Position: Shorting US Steel

Hey all, 

We are getting involved in a short sale on US Steel. The stock missed my range, so I had to pull the trigger at a lower entry of 47.45. We will be looking to exit at 46.50 – 46.05.

You can still get involved above 47, but below there I think its risky.

If you have any questions today, don’t hesitate to ask. 

Good Investing!

Bob -

Congrats. You get in Teradyne?

Bob -

You get alerts right?

Dave,
You may want to take another look at WOR, the steel company, you played last month.   It finally moved up nearly 1.50 from last month and is likely ready for a short as well….give it some thought.

Nicha -

Good job man. Yeah too bad about TER…but looks like we made the right choice yesterday. Its a definite Overnight choice if it gets to the 10.35 – 10.40 area.

Flipspiceland -

Oh yes…it looks great for a SS. I would pick it up today and hold for a lil while. It is a slower mover, but it has topped out. The green it had today was the most it will get from the AKS earnings. I can put my recommendation behind it.

Bobhu -

Are you a premium member?

David,
 
Yes, I am…  as I read Phil and your post at real time.
 
Who should I ask for alert and/or other goodies?
 
Thanks.

X keeps falling. Nice pick David. TER down too. Lets hope it comes to our range. Would like to pick it up.

Nicha -

Yeah sounds good.

Jean -

Its gone up 35% in a few weeks…it sells heavy on down days because it has a lot of volatility…natural pullback.

Working on an Overnight Trade on Silicon Labs Inc. (SLAB)…

David
Are you in for SLAB?

Overnight Trade: Silicon Laboratories Inc. (SLAB)

We are continuing our Overnight Trade rampage with another technology company that looks poised to make a nice splash tomorrow morning.

Analysis: The semiconductor industry has been raging this Q2. Specialized, integrated circuits, and specialized semiconductors have all been performing well in this earnings season. So, if we can find a slightly undervalued semiconductor company that is slated to report earnings, we want to take advantage because it could mean a great gap up tomorrow.

One such company is Silicon Laboratories Inc. (SLAB). The company makes integrated circuits that are used in satellite television boxes, portable devices, AM/FM radios, and other consumer electronics. In the integrated and specialized semiconductor industires, since the beginning of July, fourteen out of the sixteen companies have made surprise beats. The semiconductor industry has definitely shown the first cycle of business taking off as demand starts to increase for many goods.

Silcon is set to report earnings per share at 0.64. This will be an increase from one year ago’s EPS at 0.42 of a bit over 50%. The company has had solid earnings surprises for the past year and a half and has continued to grow its income. The company in its Q1 earnings said that they were expecting revenue between $131 and $135 million. Expected EPS at 0.64 is on revenue at $133 million. Nearly every semiconductor company has surpassed revenue expectations, and if SLAB can beat revenues, they will definitely surprise.

Will Silicon be able to beat EPS and revenue? The industry would say yes, but that does not give the company any exact for sure ability to beat. One of the reasons that Silicon looks very strong to me because the company is the leader in low-cost integrated circuits, which is very appealing to many companies during economic hardships. The company continues to produce lower cost and efficient integrated circuits, which gives the company a great competitive advantage.

Finally, the company has great future prospects. The company continues to develop new lines of integrated circuits. The company is moving into touch sensitive integrated circuits that are used in mp3 players and mobile devices that people touch to select various things. The company believes the human-interfaced chip market is going to be a $1 billion market someday, and they want to be a part of it. While this won’t be in these earnings, this seems to be a company that is going places, and I suspect some strong earnings will continue to be on the way for SLAB.

The stock is fairly undervalued and has a solid 4% to the top of their bollinger band, but this is combined with a very slight overvaluation on RSI. This company can break out of the top of that band with not too much of a problem, and I suspect the company will if the earnings are right. The company is not too much overbought either, meaning we can definitely get some buyer interest if earnings are strong. The final technical I see is a thinning of the bollinger bands, which means typically a breakout to the up or downside. 

Tomorrow will predict that…

Entry: We want to get involved below 43.00.

Exit: We are looking to get out tomorrow morning after earnings.

Stop Loss: None

Good Investing,

David Ristau

David are you going LONG on SLAB?

Etrading -

Nah just an Overnight!

I am in SLAB @42.78.
Thanks, David.

Good Luck..  amatta.

Good luck from here too.  I am in as well but a bit smaller.  Not wanting to spook you Amatta but playing earnings runs is like Vegas – they can blow the doors off earnings and still dump.  However, don’t be afraid to trade in pre-market.  No matter where it opens, in the few minutes after results it will probably swing wildly and let you out at a price you would be delighted with now.  My Ext/GTC order is in already.  Bulls make money, Bears make money, Pigs get slaughtered.  ;-)

Amatta -

You’ll be okay bud. I like this one.

Sennin -

My rule is out after 5 minutes with earnings. Sometimes I miss big run ups on top of gaps. Other times though, it really pays off…

HARNESS THE GREED

 David, 
Trying to make sense of the report for SLAB it looks it beat very handily but the pre-market is killing it????
What to do? 

odd reaction on SLAB, David, what do you think of it? 

 I am not sure the expectations are for non diluted? they came in 8 cents higher at 72 versus 64…

ah

So are you guys going to dump or hold at the open? I’ve been burned both ways before--panic dumped, only to see it rise within the first hour, or held and watched it dropped. So sort of feel damned both ways right now.

 Mill, 
I hear you… and as I mentioned to David, I made a stupid mistake and bought 2000 instead of 200 shares… Really sweating it here. It just doesn’t seem logical, there is no reason to drop 8%! 

Pre market from 39 up to 40 now.  looks like a good report.  put in order 2x for 39.  Wll hold the rest.  Thoughts??

People are going to panic out of this. Don’t be one of them.

Exactly. I mean panic out of the low price this morning. The company is solid.

I’m actually more optimistic than I was earlier. No guidance from David?

 Well that is encouraging….

 The stock moves quite a lot daily, there are days where it has swung back and forth 10%! So I am really hopeful here we can even get beyond entry point!

It’s a real yo-yo this morning. Rising price action looks good tho.

Nice. I was going to sell at 41.66. Then got stopped out lower. Dammit.

If the market turns positive I think we definitely get back to even and beyond… 

There might be another way to play these.  Based on the theory that the first move is often the wrong one – to flush out stops.  So getting in in pre-market at $38.xx and out at the open could have yielded a near 10% trade and much more safely.  Far too many examples of buy the rumour and sell the news this earnings season.

Nicha: My subscription has yet to run out . Again, I’m not griping about David. Clearly he has directed us to some good trades and some good companies. But I think senninha nailed it: We’re playing them wrong. Think about it: had we held off buying yesterday and bought at the open instead of worrying about trying to sell into this madness, we’d all be laughing our asses off right now.

You are risking too much capital if you’re freaking out about an earnings trade.  David doesn’t know what the report is, he is making a calculated bet based on the companies past results, competitors and industry patterns coupled with where the stock is at the time.  He was right on the earnings, but that got screwed on the conservative guidance, and since stocks trade on the future and not the past, guidance will always be more important than this qtr’s results.  
I bought the August 45 calls for 50 cents and they are worth maybe 10 cents this morning, 20 earlier.  But thats ok, since i knew that i was risking the entire bet and sized it accordingly.  

 Damn it failed. Not enough buyers, should have sold at 42.2… 

Davis, TER buy at this level?

David? Are you around… 
Damn was hoping too much it seems. Still stuck with 1,700 from the 2,000. Was hoping to get back to even and the damn thing turned on a dime at 42.25… They are extremely volatile, I saw some days without any earning news that they moved up and down $3-$4… seems support is at $40?  I really appreciate your input as I am way over my head with the 1,700 shares (intention was to have 200…
Thanks

Maybe Phil we cud ask phil for advise on SLAB.

 Sen, 
Yea I cant’ believe I didn’t take the 50 cent loss earlier. Got way too greedy trying to make it all back. It is just too much money I went in with. Do you mind asking Phil his thoughts? I have asking him way too many questions about my portfolio… I am about to give up on all this, been pegged to my computer trying to learn from Phil et al. for 3 months and I have lost $25K… now with this trade I am down another $4K…because of a novice mistake!

Senniha- I had to walk away from BAC after waiting for a few days as it kept tanking although I had options on it which prolly crashed more than the stock. I held on to FDO and sold front month calls against it and now the stock is up and will prolly be called away for a small profit. SLAB wud have been a good exit if I had setup up a limit this morning at $42.14 for a 2% loss. I really don’t want to sell input here as I don’t want to double up on this one. Will wait for a couple of hours and see. Phil seems to think the BB report will be bad and if so then the mkt tanks more and along goes SLAB.

If you have any questions…I am happy to answer. I understand you all are upset about the position, and I will do my best to try and help out and continue give you winning picks. My correctness…lifetime…is above 75%, but I am going to get some wrong. If you want to make money in the market, though, you have to keep trying and keep learning. I am everyday about the market, and I am learning also how to be a better writer and advisor to you all.

I apologize for not being here this morning. I let my youth get the best of me. I promise to make sure to do a better job for all of you in the responsibility category. I will do my best to make sure this does not happen again.

Thank you for believing in me so much that you accept my picks. I should never take that for granted.

Nicha -

I am holding for now. The fundamentals are there…give it some time.

Lapper -

You don’t have to get into it with Millstone. He only pipes up when he loses and never says thank you. But he is right that I should be around at key moments this morning when I was not…

Cslan -

I just posted an Overnight Trade on TER that I am in…I wouldn’t do XRAY though.

Check out the post!

 David, 
On SLAB I sold 300 at 42.7 after hours, 600 for 40.89 a few minutes ago, so I am still holding 1,100 at a 42.84 basis. Again I made a mistake and bought 2000 instead of 200, otherwise I would have just taken the loss at 41.50 or 42 when it was there this morning (should have unloaded 1,000 there by the way). But anyways now they are 25% of my portfolio, and so I need to really consider the risks here… You think the support at 40 is going to hold and head back higher based on techicals? fundamentals it would seem to me from the release and your coverage that they are attractive (don’t know exactly how they compare to peers on valuation?)
Thanks

 What is the downgrade you are referring to? This was Q3 for the company right? So how come Q2 were not factored in?

David: As a paying customer for your service, I expect you to be available at any given time, esp. when a trade is going way way way up, so I can say nice going buddy!  Perhaps my expectations are awry. HAHAHAHA
TER is 6:30 release, I am planning to be at least half way drunk by then