Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Send Me a Photo!

By -

I figure anyone crazy enough to be on Slope on Saturday night or Sunday morning is going to be a die-hard, so here's my request – email me a photo (or even photos) or yourself to my email address, along with your screen name.

Why this strange request? I wanted to put together a fun little video of Slopers, since I was so inspired by our "real avatar day" last week. I'm not going to publish your real name, and my only interest in the picture is to include it in the video. Thanks! If I get enough of these, the result will be really cool.


Our Chart Review (by Luscious and Thurston)

By -

Luscious LD:  Thurston, we made such a bumble in our
debut.  As we crawl from under this bus
together, I need to tell you what happened Friday. I was having lunch with M at
that restaurant that we both adore.  As
we were leaving, I felt someone press behind me in the most horrid way.  It was LB. 
His breath reeked of onions and garlic; it distracted me so I wasn’t
quite sure but I believe that he delivered a little pinch where he shouldn’t
have.  God’s work indeed! I wished he
would take a break and indulge in the devilish pleasure of flossing and
brushing. But, the encounter did make me want to come home and look at defense
charts.  I found this one that I wanted
to share:  LMT

TD:  I'll retreat to my study and have a look.
I’ve an idea about the resurgence of the so-called “boob tube”.  Entertainment has evolved in this digitized
world. Just look at the excitement in this very blog last evening! Both of us
need to loosen up a bit—I think that we can learn from these Slopers! Maybe we
can join in next week? Perhaps I can utter a witticism that will be captured by
that Biffermas fellow. Back on point now: 
Please take a look at CMCSA, and tell me if you see the same potential
as I.

Lockhead-Martin (LMT)

LMT Chart final

Click for weekly chart

TD:  Daily chart shows a reverse head and
shoulders that may foretell future upward movement if the pattern
completes.  There is profound
accumulation that exists between $73 and $76 which should provide a sound floor
for prices.

Pulling back to a
weekly view there is nice accumulation throughout the $72-80 range. The current
price is identical to October 2008 and looking quite stagnant.  My only concern is continued lateral movement
will serve simply to tie money up with little gain and exposure to loss.  With society growing rather weary of our
military forays I can’t help but wonder what the future holds for
Lockhead-Martin.  I do know our leaders
are experts at finding new sticky situations around the globe so perhaps this
worry is without merit. 

LD:  Tuesday will be pivotal as
they report earnings.  If it breaks out
here, then watch for a pullback before entering.  Because several stocks in this sector have
broken out or have some possibilities, I created a chart book of these stocks
for readers.  They can be found here.
  I also pulled the support and resistance









Comcast (CMCSA)

CMCSA Final chart
Click here for weekly chart 

TD:  Daily chart shows a lovely cup and handle
pattern.  The December run up showed very
high volume and the handle consolidation is orderly with lower than average
volume.  The %B indicator I love has
retreated to its lower boundary which indicates a possible upward move might
occur.  Keep in mind I have no intention
of committing assets until I witness a break of the downward sloping handle
trendline.  I must see a firm rise and
daily close above this.  If I do purchase
this, I will use a stop-loss on any retreat and daily close below the
aforementioned trendline.

The weekly chart
shows my upside targets.  $22 is the
previous peak high set in August, 2008. 
I will sell 50% of my position halfway there (currently 19.21) and raise
the stop loss on remaining.  The second
portion will be sold upon hitting $22.

LD:  My view of the weekly chart shows that you
have relatively safe entry on the weekly with a confirmation on the daily. It
could very well break out.  I would
prefer to take a starter (probing) position here with a stop at $16.25.  Adding to that at the levels you indicate now, I’ve just taken a quick peek at the balance sheet.  I don’t like companies with negative working
capital.   Trending123 gave the following
support and resistance levels: 









LD: Your idea is a good one, and it inspired me to take a look at the entire
sector.  I know you find that tiresome.
But I’ve seen Leisa do this from time to time, and I think there is some value
in that.  You’ve found a potential gem,
and I think that mining for more is in order. 
Perhaps Slopers would enjoy viewing these charts, too.  They are presented here.  I was intrigued with AMSCA.

I believe by sharing we've managed to collaborate like that Biffer-fellow mentioned in his post. Now remember our rules of engagement,
Thurston: If either of us has a position in a stock we are discussing, we must
disclose it.  Also, we need to remind everyone that each person should conduct
his/her own due diligence and make decisions within appropriate and clearly
defined risk parameters.

Thurston_flipped copy Do ask Henry to check the side garden.  I caught the faint whiff of a skunk and what looked to be a skunk snow angel.

TD: Skunk snow angel?  Strange things do happen here.  Remember the time Fluffy somehow slipped into the pool?  Never before have I seen such an angry wet cat.  I believe that Henry is still cleaning hair from the filter.

Grandma’s 50% Return

By -

Biffermas's "Grandma" stock picking contest and his reaction/ connotation that options were a bit racy kinda got me thinking…

Generally I prefer to forgo
the “ownership experience” and pretty much stick with an associated
option. Often misaligned and frequently misused, options were (this
is a recording) actually invented to control risk. But here’s how
Grandma might do it:


Let’s say PFE opens Monday
at today’s closing tick and the old lady buys 1000 shares @ $19.47
total cost $19,470.

After many years in the market
Grandma has a few cast-in-stone rules; one is to never let a stock run
more than 10% against her.
Since she doesn’t like stop loss orders
she’ll purchase 10 PFE Jan 2011 $17.50 puts @ $1.40 total cost $1400
Grandma has defined her risk at 10% (give or take, roll with me on this please). 

The puts for insurance were
$1400. PFE pays 3.70% dividend which comes to about $720. So if PFE
goes nowhere this year (certainly possible) this trade’s still a $680
loser. To counter, our geriatric derivative wizard sells 10 out of the money
(OTM) February 20 calls, about 2.7% OTM, @ .30 for a credit of $300.

Here’s how this year might pan out: 

Grandma collects $300.00 x
12 months for $3600 selling OTM calls. Minus the remaining $680 bill
for those puts= $2950 or about 15% return on her original investment.
Not bad…


Grandma’s PFE gets called
away every month. She’s made the $300 call premium plus the $530 difference
from her original purchase and the strike price that she “loses”
her stock. And she reloads to do it all again. Here’s the math $300
call premium + $530 stock appreciation= $830 x 12 months= $9960 or 51%
on her original investment. Tasty.


Some combo of the above.


Trade is complete and utter
failure. PFE falls into the abyss (we’re talking the largest heathcare/
drug manufacturer in the US here) Grandma loses the spread between purchase
price and put insurance floor, plus the price of that insurance for
a total of $3390 less the est call premium collected for 12 months $3600= 
no loss? Yep.

Yes they’ll be commissions.

Yes these numbers are “today’s”
numbers and we don’t know what future premiums will be. On the other
(without launching into the Greeks) there’s certainly a good
probability premiums will become higher as the year progresses– then tasty becomes downright sweet!