Reloading the Ledger

Add MOS Puts and WHR Calls

By Bryan Bottarelli
Tuesday, September 29, 2009 11:38 AM EDT
Tue, 29 Sep 2009 15:38:00 GMT

PLAY: Buy the MOS October 50 Puts (MOS VJ) at or under $3.20, good for the day. Place a protective stop limit at $2.20 and a sniper sell at $5.00.

PLAY: Buy the WHR October 70 Calls (WHR JN) at or under $3.10, good for the day. Place a protective stop limit at $2.00 and a sniper sell at $5.00.

Dear Bottarelli Research Member,

With our cupboard all but empty (except for our AEM October 65 Calls), I’d like to continue the tactical strategy of navigating these choppy market waters by owning a balanced ledger of bullish and bearish company sectors. As outlined yesterday, the potash/fertilizer sector will remain weak for the remainder of the 2009 calendar year. As you know, we parlayed this weakness into a quick-hit winner today on POT. But to extend upon this trend, I’d also like to establish a new put position in Mosaic (MOS – NYSE). As you can see from the chart below, MOS has plenty of room to fall, with downside targets at $45 followed by $40. Let’s profit off this weakness using October puts.

MOS

PLAY: Buy the MOS October 50 Puts (MOS VJ) at or under $3.20, good for the day. Place a protective stop limit at $2.20 and a sniper sell at $5.00.

Over on the call side, let’s use today’s market dip to prepare ourselves for more dip-buying, which also coincides nicely with any end-of-quarter “window dressing.” One chart that piqued my interest occurred on Whirlpool (WHR – NYSE). As you can see, the stock has had a nice upside push, which recently pulled back to a support level. If WHR can rally off the $70.00 level, we could be in for a nice ride. Let’s get positioned now using October calls.

WHR

PLAY: Buy the WHR October 70 Calls (WHR JN) at or under $3.10, good for the day. Place a protective stop limit at $2.00 and a sniper sell at $5.00.

Now, on a side note, some members have asked me to share more information on how the daily market moves are manipulated by the financial elite. This has been a major topic of my research lately, which is something I’ll soon be devoting an entirely new service to. I’ll give you more information on these exciting developments in the weeks and months ahead. But for today, one reason why I’m comfortable holding gold exposure (via AEM) is supported by today’s news out of the Washington Times.

In an article from the publication, it’s reported that World Bank President Robert B. Zoellick warned that the continual rise of foreign economic powers could soon put an end to the privileged role enjoyed by the American currency. In other words, the U.S. dollar’s position as the world’s top reserve current is very much in jeopardy. As you know, the dollar’s status as the world’s reserve currency has given the U.S. prestige and privileges that helped lift American living standards for decades. After all, everyone knows that Americans borrow cheaply and consume far more than we produce – all with no consequence. But if you read between the lines, these days are quickly coming to an end. According to Mr. Zoellick, as quoted in a speech to Johns Hopkins University’s School for Advanced International Studies in Washington, “The United States would be mistaken to take for granted the dollar’s place as the world’s predominant reserve currency. Looking forward, there will increasingly be other options to the dollar.”

This is a scary situation, especially when you consider the fact that China has a $2 trillion surplus, and keeps most of their reserves in dollar-denominated securities (like short-term Treasury bills). But now, China is growing very uneasy with the decline of the dollar (down 16% since March against the Euro). Therefore, they’ve begun to aggressively buy gold, simply to hedge themselves. As a result, I continue to like the idea of buying gold on any dips. Hence, maintain your AEM calls for more gains.

And as always…

Lock and load!

Sincerely,

Bryan Bottarelli

Bryan Bottarelli
Editor, Bottarelli Research

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