Jeff Kohler's Trading Blog

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"How Has Brown Worked You Today?"
2008-04-09 17:46:00
Today marks the lower open for a lot of the great stocks on last weeks watchlist. You know, all the great stuff I missed because I was on vacation. AKS, CLF, FDG, APA, POT, XEC, DVN and UNT in case you were wondering.I like the little exhale we are seeing in the market today thanks to UPS. "How Has Brown Worked You Today?"I think today offers a good opportunity to buy re-tests in a few recent breakouts...FMC- $59 offers a good entry point while offering an area to help manage risk.GILD- I still love this stock, and this entry pointThese are just a few examples of set-ups that should be easy to find. Here are a few other ideas I am working on today...HOLX- Here is the reaction I have been waiting for...I own puts today.MGM- I bought puts yesterday, but here is the anticipated "breakout" I have been looking for.NFLX- Another price pattern to add to the list...PCLN- I am going to establish a small position today, and increase it on a breakout. TJX- I'll be buy...
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Meeting
2008-04-09 02:37:00
I have set up a conference call for this evening- 8:30 MT, 10:30 ET... Sorry for the late time but it is what it is.The purpose is to get some reader feedback and discuss suggestions and ideas.Here are the instructions to join...You scheduled the following Web seminar using WebEx. Topic: JK Meeting Date and Time: April 8, 2008 7:30 pm , Pacific Daylight Time (GMT -07:00, San Francisco) Event Number: 369 379 694 Event Address for Attendees: https://investools.webex.com/investools/o nstage/g.php?d=369379694&t=a ----------------------------------------- -------------- Teleconference information ----------------------------------------- -------------- Call-in toll-free number (US/Canada): 866-469-3239

Leaving Las Vegas
2008-04-08 18:38:00
I mentioned a few weeks ago that I was bearish on Casinos. As I made my way through Las Vegas over my vacation, I am a lot more confident in my stance. From a glance you'll see major construction going on, but a closer look will show you that the Casinos are relatively empty and there are plenty of rooms available. Plus, I am sitting here putting together my Las Vegas presentations that are due this week and I can't help but think how badly I want to short Vegas. Here are a few ways to do it...BYI- You'll remember this one from the watchlist a few different times. As this approaches $35, I like the entry point. A downward swing in the market can force this stock back to it's lows.IGT- Also a watchlist favorite...this week confirmed a bear flag with a $7 price target.LVS- A break below $72 could start a small collapse in the stock price.MCRI- A good short here at resistance.MGM- Possibly my favorite out of the bunch. That is a strong support level getting read...
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One Last Thought
2008-04-08 06:34:00
I am toying with the notion of calling together an Option Addict meeting tomorrow night via conference call. There is a lot of shit around here that I need to clean up, people I need to slap, and websites in which I need to establish direction and administer guidance. I am no longer satisfied with mediocrity around these parts and losing readers to dime store competition. In short; the game is going to change. Be prepared...
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Tournament Results
2008-04-08 06:29:00
Here are the final results for the "Option Addict Madness" challenge. It was a great championship game, despite a terrible outcome. Again, thanks to everyone for your participation. Congratulations to Rick, Chris and Jeany...you'll be hearing from me tomorrow.
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Weekly Watchlist
2008-04-08 06:05:00
After having spent the day searching high, low, near and far...I have compiled another list of stocks that will enable me to stack a few chips in the market this week. As you may have noticed, I didn't load this into another video. That is only because I am lazy tonight. My bad.Starting with a few price patterns...FCN- A head & shoulders pattern- should make a nice move to the downside herePCLN- An ascending triangle of sorts. Pick up some calls on a break above $130.SII- Early stages of a flag...I like this stocks potential to reach its highs.AMZN- Inverse head & shoulders; buy with both hands on a break above $80.FMX- A cup & handle... A break above $44 could mark a $6 move higher.TAP- Ascending triangle- $5 price target.CX- Short term triangle of sorts; longer term inverse head & shoulders pattern.IGT- A remarkable bear flagCHU- Symmetrical triangle; could break either way.FXE- Ascending triangleCMA- Descending triangle with a $10 price target upon a break of $35...
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Tournament Challenge
2008-04-08 00:23:00
The "Option Addict Madness" Tournament will name it's winners tonight. The last two teams standing will battle for the NCAA Men's Championship title. Speaking of "battle" here are the standings heading into tonight's game.  As a reminder, I will be sending off the first, second and third place prizes after tonight's game. I will be in contact with the winners via e-mail to arrange the details. Thanks again for playing everyone...Good luck! PS- This weeks watchlist will air after the game is over.
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I'm Back
2008-04-07 16:06:00
You are all very lucky. I almost extended my vacation by another week. Sitting here this morning has me feeling like a market virgin all over again. It is tough to jump back in having missed a full week of activity. Plus I haven't complied any research yet, so I am sitting here with no real coin in the market and nothing on deck to trade. This is the part of "vacation" I hate. As you can imagine, this is the first thing I plan to do today.While I am sitting here with nothing to do, the biggest question not on my mind is..."does the market want to go higher?"I got the breakouts last week that I wanted to see in select agriculture, steel, and energy names. With the exception of a few longer term holdings, I missed some of the ones I have been watching for weeks. Sucks.Speaking of "missed," I have to admit I left one hell of a watchlist behind last week. I am pretty upset that I wasn't here to trade it. In my absence, I hope you took full advantage....
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Greatness
2008-03-30 05:23:00
I don't normally like to post articles that are as lengthy as this one here, but when the quality is there I will make an exception. There are a few sports references and examples (which might not interest all of you), but overall I thought this was a great article. If you have the time run through this and give it some thought.What It Takes to Be Great Fortune on CNNMoney.comBy Geoffrey ColvinResearch now shows that the lack of natural talent is irrelevant to great success. The secret? Painful and demanding practice and hard work What makes Tiger Woods great? What made Berkshire Hathaway (Charts) Chairman Warren Buffett the world's premier investor? We think we know: Each was a natural who came into the world with a gift for doing exactly what he ended up doing. As Buffett told Fortune not long ago, he was "wired at birth to allocate capital." It's a one-in-a-million thing. You've got it - or you don't.Well, folks, it's not so simple. For one thing, you do not ...

Trade or Drink?
2008-03-30 05:21:00
Traders and Drink ers...Are We Different After All? If you find this post offensive, relax. This post is not intended to offend, only to discuss more trading psychology. I pass no judgments on this topic because I have lived through this subject in different aspects myself. I came across an article that correlates destructive trading to destructive alcohol consumption. Take a quick look at this questionnaire that professionals use to determine the severity of alcohol abuse...1) Have you found that your drinking is bringing unwanted, negative consequences?2) Have you recently felt guilty over the way you have been drinking?3) Do you find you need to drink more just to get the good feeling?4) Do you find that your personality changes when you drink excessively?5) Do you find it difficult to take a break from drinking, even when part of you knows that this would be best for you?6) Do you find yourself drinking to feel good about yourself?7) Do you sometimes feel that you cannot con...
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15 Common Sense Rules
2008-03-30 05:19:00
Common sense can be brutally honest sometimes. As traders we get so focused on the little inconsequential details sometimes that we miss the world around us. I have had this discussion with too many people over the last two months that told me they were bearish on the market and were taking a beating on the "high probability" that the market would reverse. Who sets those odds by the way? Are trends more likely to reverse than persist? If so, why the hell are we studying technical analysis?Take a look over these trading rules I stumbled across last year and see if there are any realities that surface from them. Each time I look these over it reminds me of the realities of what we do here.1. No matter what you read about trading, until you use an approach and test it with your money on the line you will never learn how to trade. Paper Trading is NOT Trading!2. If it were really possible to "Buy Low Sell High" or "Cut your Losses and Let your Winners Run",...
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My Ten Commandments
2008-03-30 05:16:00
Here is a compilation of my Ten Commandments of Trading. In my sole opinion, these are the "fundamentals" of becoming a successful trader. Look these over and feel free to comment at will. Keep in mind this took a couple hours to compile, so be nice.1. Thou shalt have a trading planIf you don't have a plan, get one. What is your approach? What are your rules? These are questions that you need to answer before you can title yourself a trader. Creating a plan gives you something to follow, an outline of where you want to be, and what is required in between.2. Thou shalt not trade with emotionThis includes, fear, greed and lack of discipline. There is no room for it in this equation. Find a way to get a better handle on it, and/or walk away from it. I can tell you from experience that you will have an impossible time being successful at trading when making emotional decisions.3. Thou shalt embrace losingA trader has to fight a lot of expensive enemies within himself. It is i...

Weekly Watchlist
2008-03-30 03:59:00
I didn't have the time to produce a full length feature film. You get the print version instead. Starting with a few price patterns...AMZN- If prices rally here at $70- watch as an inverse head & shoulders develops. You could buy on an increase with a stop just below $70 anticipating a breakout above $76. Once that happens, a $15 point move is the target.GMT- A re-test of an inverse head & shoulders pattern. Trannies are hot, and GMT's target price is $46 over the next few months.FMC- It's somewhat of a triangle- but I'd be buying calls soon in anticipation of a $5-$6 point move.AGN- They make implants...and there is a rising wedge. I am expecting about a $5 point drop unfortunately.GILD- You know I like this one, and the flag pattern that is developing. This is a good opportunity to redeem yourself if you missed the triangle breakout from the last few watchlists.AFL- Good looking triangle...piss poor industry.MA- Still a triangle of sorts...BX- Symmetrical tri...
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Weekend Special
2008-03-28 22:57:00
The new "Weekly Watchlist" will make it's way on the blog over the weekend. I know- I'm a helluva guy.I am doing this because I am regrettably going to be away next week. I have decided to take a vacation.However, I will be updating the blog so that the community can press on and keep conversations organized on a daily basis. I will probably re-run a few of my "greatest hits" and "greatest misses" during the week, which will offer a place to leave comments each day.Have a great weekend, The Option Addict
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"Volatile Market" Spotlight
2008-03-28 16:29:00
Today I will be hosting a free volatile market spotlight. If you would like to register, please click here.It will be today at 3 MT, 4 CT, 5 ET; and will last an hour long.I was told the presentation is "personality driven" and will be an opportunity to share my watch lists, my philosophy and my methodology.How exciting :)
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Industry Group Spotlight: Food
2008-03-28 15:50:00
Yes, I know. Pretty lame.However, I was thinking about creating my own ETF (FOO) of food stocks, which will easily double the performance of the market over the next 1-2 months. Don't believe me? Track them.Here is my "shopping list...."LONGCQB, HRL, WWY, TSN, KFT, GIS, CAG, HNZ, MKC, DLM, FLO, KSHORTGMCR, WBD, ADM, BG, DF
More About: Food , Industry , Spotlight , Group

Short the Miners
2008-03-27 15:48:00
Not too long ago I mentioned the weakness in hard commodity prices and producing companies. Most of these stocks are at an interesting point right now, which ought to confirm changes in their trend.BVN- Looking like a great opportunity to buy putsGG- LikewiseGOLD- See...You can lump all other miners into this category, they all look the same. As you can see this is the early stage of a trend reversal. While I am not bearish on the yellow metal itself, I am bearish on the mining companies as a whole. In closing I'll throw a bullish idea at you (again).....NFLX- If you didn't take it down at the flag breakout (which is the last time I mentioned it) I like like it here today.By the way, basketball starts back up today. I am not sure if I told you this, but the pot has reached $2k. This means that I will be passing out $1400 for first place, $400 for second, and $200 for third. I'll be back around this afternoon. 
More About: Short , Miners

Follow Up
2008-03-26 15:25:00
For those who participated in the "Would you trade this" exercise, thank you. Here were the results...What is interesting is that first and second place were decided by two votes. A third of the participants said they would buy calls on this example, the other third said they would wait.Want to know my vote?I would wait.In full disclosure, I own calls on GILD. In fact, I realized that most people knew this after I read through some of the comments. Most knew about my sentiment on this stock via the weekly watchlist, and knew how I treated it. Let me discuss this further with a chart...I discussed this stock a couple times over the last few weeks. I have been watching this stock as a relative strength candidate to the overall market. As you can see, its trading at its highs and has been relatively immune to the market. Most notably, I mentioned I had been watching the triangle pattern that had developed from beginning to mid March. The breakout occurred back on the 20th, wh...

A Guide to Trading Spreads
2008-03-26 15:23:00
You can't argue that market volatility isn't making options buying a complicated process. As a result of higher market volatility and fear from market participants, option premiums are a recipient of higher implied volatility. Higher implied volatility causes time value to become increasingly expensive, as a result a buyer pays more for an option while a seller receives more from the sale of an option. The topic of buying options vs. selling options is one of my all time favorite debates. While I am not much of an option seller, I can't argue that the market conditions favor this strategy entirely. If you have never traded a spread before, think of it as buying an at or out the money option, but then selling a more expensive option in front of it. The short option is the driving force of the trade since the premium is more expensive and you are the recipient. Remember that as an option seller, you are no longer dealing with rights (right to buy or sell a stock) you...
More About: Trading , Guide , Spreads

Would You Trade This?
2008-03-25 19:29:00
Here is today's candidate. I like this example for several reasons; all of which I plan to explain later. Note: This is not a trade recommendation, I am merely asking if you would trade it. I'll tell you how I treated this after I've gotten a few responses.
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Niner
2008-03-25 17:45:00
I am developing a "Guide to Selecting Spreads" right now. I thought it could act as a good reference to use when deciding when each option strategy is optimal to use. I should be done this afternoon.Also, I apologize for the lack of substance on my part around here (I warned you about the month of March). I am in the process of getting back into a rhythm.I also opt for an interactive game today. Like "Would you trade this?" Any suggestions?

Free Advanced Options Open House
2008-03-24 22:01:00
Click here to sign up/attend tonight...I am going to talk mostly about strategies that will work well in current market conditions, along with a discussion on volatility. See you there.
More About: House , Open , Free , Options , Open House

Baby Steps
2008-03-24 17:45:00
There are some particularly good moves happening within the market today. This has me thinking that this is more than just another sharp correction in this psycho market. There is some actual substance materializing behind this rally.XHB- Homies are collectively moving higher. This is a good thing.       ;      RTH- Retail has also broken out of a consistent downtrend.SPX- Take it one step at a time...My first step is to 1375ish.     &nb sp;      &n bsp;In closing, I am sure you have all noticed that BSC has received a higher buyout offer. Personally, if I could get the financing, I would double that $10 per share offer that JPM has inked. Barrons ran an interesting article a few weeks ago conservatively pricing them nearly triple their current offering. I talked about the strange activity in the stock price last week, and mentioned that the market was betting on a hig...
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News Flash: Watchlist Delayed
2008-03-24 05:36:00
Due to technical difficulties the watchlist won't make it out until tomorrow afternoon. My bad.If you are in dire need of trade ideas, please visit last weeks watchlist video.If that does not work, try the week before. 
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Standings
2008-03-22 05:38:00
Lots of folks tied for first & second...

Concerned...
2008-03-20 21:45:00
It looks pretty bad that I am undefeated thus far in the bracket challenge.You better hurry and catch up.
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It's On...
2008-03-20 17:31:00
Alright, registration is closed. Good luck to all, and thank you for participating.So far I have tallied well over 100 people.BTW- If you haven't paid; do so.In the meantime, I think I might get short (again) here...SPX (5 day chart)- A break of the neckline could mean we test the lows. I also might short Portland State. I wonder if they can score more than 20 against Kansas.

Game Time
2008-03-20 15:12:00
Here's a trio of ideas I like this morning...ATI- Here is a relative weakness candidate in the Steel group. A nice bear flag in the making.GILD- This one has been resilient as hell. It's getting ready to pop again.MHS- I like the set-up hereAnything else out there is looking overdone, but I am still looking. At least for a few more hours.PS- Most of you know I have been preoccupied setting up this tournament. The good news is that the deadline is in less than 2 hrs ( 12 noon ET). One last reminder to e-mail me if you have paid but not registered, or pay via paypal (id:  jkohler32@gmail.com) if you have registered but not paid yet.Thanks for your participation. I will be trying to reconcile all the payments/registrations right now before game time to make sure everyone is all set. Again, I'll be in front of my e-mail so let me know if there are problems.
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Update
2008-03-19 22:56:00
The March Madness purse is closing in on $1300...If anyone else is interested, send me an e-mail for an invitation.For those that have paid/registered, don't forget to make & save your picks.If you haven't paid yet, let me know your status before tomorrow at 10 a.m. ET.As for tomorrow, I'll make sure I post my thoughts early, because it is highly unlikely you'll see much of me.
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Something Smells Fishy Part II
2008-03-19 21:56:00
It's happening again...If you didn't participate last time, here's another chance. I fired off a bunch of orders in the 30's this afternoon.
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