ALVR Update

I am currently holding the 1/3rd position after selling down 2/3rds of my position before and immediately following earnings. I believe in the ALVR story and will buy up more when the dust settles, unless I experience a 25% draw down of my 1/3rd position.

Purchased 500 shares CLWR @ $21.40

Increased my position to 1/2 on move up yesterday beyond 2% of entry. Had a hard time doing it in all the carnage, but rules are rules. The news was that there are merger talks with Sprint. This is a WiMax play just like ALVR, which has recently tanked following earnings.

Sold 1,000 shares ALVR @ $12.67

Earnings report was ok - in line with everything, but holders were expecting more. I have been watching the stock steadily creep lower. Sold 1/3rd position when my net profit hit 10% - down from 20% at open. So, I sold 1/3rd position at +20%, 1/3rd at +10%, and am now holding final 1/3rd. I will sell if it gets to break even.

Bought 1000 shares AOB @ $14.39

AOB increased to 10% above my entry point thus triggering my buy order for my last 1,000 shares. It is acting very nice with this breakout on the daily charts. I will be targeting 20% profit to peel off my initial 1/4 block.

Purchased 1,000 shares AOB @ 13.36

Thanks Motley Fool for finding one of my holdings after I established a position - appreciate it. Because of that, and the attention it attracted, I picked up 1,000 shares, which brings my position to 2/3rd full. The thing that I do not like about this is that these types of news purchases usually retrace over the next couple of days; however, rules are rules. I am currently up 6% and will pick up the final position once I get to 8% profit.

Sold 1000 shares ALVR @ 13.72

Love the stock, but took 1/3rd position off the table since I had a 20% profit and earnings are in the morning. There is no reason for me to believe that the earnings and outlook would be anything but stellar; however, my rules require me to take off a position when I get a 20% profit.

AVNX +13% - Star Performer of the Day

Yeah, yeah, yeah - after I sell down my position to a 1/4 holding the Bastards come out with the news. Unbelievable. Take a look here if you are interested in reading about it.

http://biz.yahoo.com/ap/071029/avanex_pirelli.html?.v=1

This is the reason to not liquidate holdings all at once - scale in and scale out. This does not apply if it is the first position taken and it has experienced a 25% draw down (toss it under a bus at that point). Now the question is whether or not to re-establish a position. Earnings are coming up on Thursday. I will hold until then, listen to the conf call, and then decide its fate.

Nice run today.

Futures Market Summary

Today's action was classic consolidation/chop that went nowhere fast following the initial move out of the open. The consolidation resulted in one touch and two breaks of the Globex high, and no touch of the Globex low. The Doldrums Range was inside of the Globex Range, which is a tell that we were going to have a non-momentum day. I said this morning that I was going to be looking for a trade only when we broke the Doldrums high or low; however, I held off on the first break because the Globex range was just above and below the Doldrums Range. I held out to see if we were going to get a reversal off the Globex level, which we did. I took the second break because I noticed a buy divergence on the move down before the move up to the doldrums/ Globex highs. The buy divergence signaled that the move up was to be a bit more powerful than the previous. I was able to close out +11 YM ticks. I was up +31 ticks at one point, but the 2,5, and 15 min charts were all lined up with bullish signals, so I held on until price crossed the 20 ema on the 2 minute chart. Price continued to fall after the exit, so good execution. Please note that retrace to the Globex High and Doldrums High following the breakout, as well as where price settled on the day. The point is that these levels act as magnets as well as pivots.

I see two primary reasons for the stagnant action following the open: (1) price located between the 50-61.8% fib zone on the daily chart (most recent daily low to most recent daily high), and (2) Fed decision this week. There just wasn't much reason to put money to work or take money off the table with the Fed Decision coming up this week. The Fib location is a great place to set up came while we wait. A jumping off point if you will when the decision is actually made. We will have guessers piling in Tuesday afternoon in anticipation of the move.

My market summary is posted below:

YM: +11 ticks (equal to +$55 per one contract position).

Good process - flat outcome



Monday HVP: 13,887

24-Hour Range: 77 ticks
Regular Session Range: 74 Range

Morning Futures Action

Yawnnnnnnn....ready to take a nap. Regular session range is 50 ticks, while the 24-Hour Range is a mighty 54 ticks. I will be looking for the break of the Doldrums Range before I even think about taking a trade. If that is a loser, I will not take a momentum trade again until we have a 100 range on the 24-hour session. On the other hand, my stock holdings are on fire....AVNX, CYD, CNTF, APA, MVIS, etc. Oh, BTW, I have not taken any futures trades today.

Bought 100 APA @ 102.90

Rounded out my position in APA today with the nice move up it has had. Stock was upgraded to a $120 price target from a $115 price target at Bear Sterns. I don't rely on the upgrades/downgrades, but the call moved the stock beyond my 2% threshold while I carried less than full position, so I added to my position.