***Official*** 2019 Stock Market Thread

[FelixDeCat]

This will be an interesting month. We will probably be flat to lower until something new comes along to take us to new highs in the stock market. There is always the risk for a wave of profit taking which could bring a sudden and swift drop in the market. I had some Amazon calls that have paid for Christmas (albeit unexpectedly, so I sold them too soon). Now Amazon seems to be consolidating. Buy in the $1700s sell in the $1800s. Thats been the range for months now.

Gold, natural gas have fallen off a cliff!

If you watch UGAZ and DGAZ (triple levered natural gas ETFs), this week was shocking. Normally this time of year we are in draw down mode so prices go up for gas. UGAZ zoomed up to $15 last Friday. Then reports came out calling for a milder winter, oversupply and finally renewed talks between Ukraine and Russia to provide more gas to Europe. In four trading days UGAZ crashed 40% to $9 and DGAZ zoomed up from $111 to $167 in those same four days.

Being that its barely the start of the winter season, any change to demand models or a breakdown in talks between Russia and Ukraine could see this reverse. But for now some predict continued declines in gas prices.

Gold is hard to guess right now. It has broken through $1500 and threatened $1450 before going back up some on Trump signing a bill in support of Hong Kong. The trend has been down for gold lately as JP Morgan has been unwinding large positions and buying equities. NUGT bouncing between $25 to $27. If gold goes back to the longer term average $1150-$1250, NUGT will be toast. A jump back over $1500 might set a target to retake the recent high of $1550+. For now Im neutral on Gold and have no holdings, but am ready to buy physical gold at any time.

Biotech has been AMAZING lately. I own some shares of Sorrento at $3 (the company rejected two buyout offers for up to $5). I sold ANAB too early at $12, its now $13.50, with a target of $15. If you like to buy lottery tickets, there is ADXS at .51 cents. Its an abysmal loser stock that was stuck at .33 cents for a while, with a market cap of just $13 million, but it does price momentum, so who knows where its headed. Once the musical chairs stop and the rats flee the ship, it might go back to .33. I dont have any position.

 

[dasherHampton]

Looking for an idea.

I have an account that dribbles some cash flow and its built up to about $12000 over time. I don't need it and I'm thinking about buying a cheap stock with potential upside. 1200 shares at $10, or 2400 shares at $5, or whatever.

Anyone got their eyes on something I can check out?

 

[FelixDeCat]

Looking for an idea.

I have an account that dribbles some cash flow and its built up to about $12000 over time. I don't need it and I'm thinking about buying a cheap stock with potential upside. 1200 shares at $10, or 2400 shares at $5, or whatever.

Anyone got their eyes on something I can check out?

I like Sorrento SRNE (see above). Bought at $3 and shares keep climbing on two rejected cash offers for up to $5. The stock is in fire today at $3.60 but it does consolidate so beware. There are articles claiming $30 is the long term fair value due to its drug pipeline.

 

[dasherHampton]

Hmmm. That's interesting. Thanks for the tip.

I bought 1000 shares for now. If things break right I'll add more. If not it's not that big of a deal.

lol- wish I would have bought at open.

 

[dasherHampton]

I went ahead and sold the Dec 20 4 calls for about $400, because I can't help myself.

 

[FelixDeCat]

Hmmm. That's interesting. Thanks for the tip.

I bought 1000 shares for now. If things break right I'll add more. If not it's not that big of a deal.

lol- wish I would have bought at open.

I am still kicking myself for selling ANAB. Bought at $10.80 and sold at $12. Current price is $14, which is less than cash on hand of $15. It used to be worth $100+ but management has been poor and its primary drug failed phase 2 study which is bad.

 

[dasherHampton]

I know the feeling.

Hell, I had a lot of ROKU when it was under $40. That's how it goes. You have a plan and stick with it.

Any profit is good.

 

[dasherHampton]

Holy crap.

I know a guy who was pumping SAGE. Its down almost 60%, from $150 to around $60. He must be getting ready to jump.

 

[FelixDeCat]

Holy crap.

I know a guy who was pumping SAGE. Its down almost 60%, from $150 to around $60. He must be getting ready to jump.

I never followed that stock. It has $21 a share in cash ($1.2B). Me thinks it drifts from the $60s to the $40s or lower.

Not scared yet? Check this out:

Cash Flow Statement

Operating Cash Flow (ttm)	-513.76M
Levered Free Cash Flow (ttm)	-269.11M

 

[dasherHampton]

OK Felix.

I'm in for another 1000 shares of SRNE. Let's see how this plays out.

 

[FelixDeCat]

OK Felix.

I'm in for another 1000 shares of SRNE. Let's see how this plays out.

Its hard to say. I looked more into this company and found something out about Sorrento. But first, the backstory -

I've been a trader for 20 years and have owned my fair share of biotech stocks. One thing you always have to keep in mind when investing in small cap moon shot biotechs is that they LOVE to do secondary offerings. In other words, your investment is subject to serious dilution, and that is obviously bad.

Always google the company name and the term "secondary offering". As it turns out Sorrento is no stranger to secondaries, so BEWARE.

 

[dasherHampton]

Yeah, I've experienced it a few items.

I think most recently with ONCS (last year iirc). I had shares at a basis of like $1.70 and they offered up a ton of new shares at $1.50. It cratered the stock for a while.

But taking into account the options I've sold my cost basis on SRNE is around $3.10. I have plenty of room to play with.

If it's over $4 on Dec 20 you'll have made me about $1900. Not bad for a few seconds of work, and well worth risk imo.


- ideally it'll stay just under $4 on the 20th. That would make the $4 calls pretty juicy. I would maybe even check out higher calls down the road.

 

[FelixDeCat]

Yeah, I've experienced it a few items.

I think most recently with ONCS (last year iirc). I had shares at a basis of like $1.70 and they offered up a ton of new shares at $1.50. It cratered the stock for a while.

But taking into account the options I've sold my cost basis on SRNE is around $3.10. I have plenty of room to play with.

If it's over $4 on Dec 20 you'll have made me about $1900. Not bad for a few seconds of work, and well worth risk imo.


- ideally it'll stay just under $4 on the 20th. That would make the $4 calls pretty juicy. I would maybe even check out higher calls down the road.

Hope you bought back those Sorrento calls, it did pretty nicely today at $4.16 and $4.30 after hours. I wonder if traders might try to bid it up to $5 being that was the last buyout offer price, or if Sorrento might try to arrange another near term secondary with all the price momentum.

I've also been watching SAGE. You mentioned it at $60, and I thought it would go lower, but it has in fact GAINED some lost ground at an intraday high of $69.50. It has now made up almost 10% of the $90 drop last Thursday. How much more will it recover, if any? Hmmm....

 

[dasherHampton]

No, kept them. They're my hedge.

As we discussed above: I've seen this movie before. I'm not saying this is a pump and dump but you never know. If one big holder cashes out it could start a free fall. And that's the "best case" scenario. If it's a P&D they'll all collude and cash out at the same time.

That being said, I've read enough by now to feel comfortable owning a few thousand shares of SRNE until it gets called away. Dec 20 is a long ways away. If it drops back to $3 for some reason I'm ok with that. I'll just pocket the option profits and sell $3.50 calls.

Hell - if it drops back I might buy more.

 

[FelixDeCat]

Holy market rally batman.

 

[JEDI]

Oil went up to $60/barrel.
why isn't US rig count sky rocketing?!

 

[FelixDeCat]

I think small oil/gas companies are in survival mode right now, trying to avoid bankruptcy. Increasing rig count increases production which in turn lowers prices. Non sensical to do so at the moment.

 

[dasherHampton]

SRNE, could you do me a solid and stay right where you are for four more days?

 

[FelixDeCat]

Bought 2000 ACHV @ .50 ....probably dead money for awhile.

 

[ponyo]

Bought 2000 ACHV @ .50 ....probably dead money for awhile.

That's $4 million market cap penny stock. No thanks.

Still long and strong with TSLA shares and leap options. Still think it's the most grossly undervalued stock on the entire Nasdaq. If Tesla was any other stock, it would be trading $800+ minimum right now.

 

[FelixDeCat]

That's $4 million market cap penny stock. No thanks.

Still long and strong with TSLA shares and leap options. Still think it's the most grossly undervalued stock on the entire Nasdaq. If Tesla was any other stock, it would be trading $800+ minimum right now.

The irony of course would be if TSLA went to fiddy cents one day.

I bought figuring its worth about .70 in cash eventually. including this dilutive offering. Thats the biggest risk with moonshot biotechs. Good news is they are in advanced trials, but even this molecular cap is a risk.

 

[ponyo]

The irony of course would be if TSLA went to fiddy cents one day.

I bought figuring its worth about .70 in cash eventually. including this dilutive offering. Thats the biggest risk with moonshot biotechs. Good news is they are in advanced trials, but even this molecular cap is a risk.

I have no biotech and no penny stock purchase rule. Couple times I have not followed my own rule, I've been burned. Biotech for me is straight up gambling with really bad odds. If I want to gamble like that, I rather do it in Vegas where I can at least have some fun. I know zero about anything biotech so I can't do any proper DD to challenge my position if the stock drops. Then, I'm at mercy of the FUD because I don't know who to believe. Once that happens, game is over since I can't defend my position. And that helpless feeling is something I rather avoid.

Tesla could drop to fifty cents one day. Nothing is impossible. But if that happened with Tesla, at least I would know if it was deserved or not and if it's buying opportunity. Just like when Tesla dropped to $180 in June, I knew people were being stupid and wrong so I bought more Tesla shares and options. I never lost ounce of conviction because I had done my research. I can't do that kind research with biotech so it's impossible for me to have any conviction.

 

[ponyo]

TSLA surpassed its all time high today and closed at $393.15. The previous all time high was $389.61 set intraday on Sept. 18, 2017. Back then, Tesla was producing and delivering just over 25,000 cars a quarter. Today, Tesla is producing and delivering more than 100,000 cars a quarter. Tesla has come long ways since then but still has lot further to go. They're just getting started. Same for Tesla stock price. ~20% of the float is short so there's still plenty of rocket fuel left in the tank for epic short squeeze. Get ready for internet meme when TSLA hits $420.

 

[FelixDeCat]

There is no doubt you were right about TSLA so far. And I will admit I was skeptical, calling it overpriced and due for a fall. Not to say it still cant fall in half, but if you are buying and holding to see your vision come true, a few dips a long the way dont matter. If it were up to me, everyone would get a home run in every investment they make.

Heck, I remember the day 20 years ago .... I laughed at Apple Computer investors after the stock fell 50% in one day following the collapse in sales of the iMac in September 2000. The company was in deep doo doo and being poorly managed at the time. It fell another 12% thereafter before finally bottoming out. Who knew it go up split adjusted from $1.30 from that point to $279 today? Smartphones did not exist and Steve Jobs was not yet back at the helm.

So now we are about to enter the ROARING 20's again. I wish everyone much success and hope we all do well.

ps. Sell everything by October 2029. LOL!

 

[ponyo]

There is no doubt you were right about TSLA so far. And I will admit I was skeptical, calling it overpriced and due for a fall. Not to say it still cant fall in half, but if you are buying and holding to see your vision come true, a few dips a long the way dont matter. If it were up to me, everyone would get a home run in every investment they make.

Heck, I remember the day 20 years ago .... I laughed at Apple Computer investors after the stock fell 50% in one day following the collapse in sales of the iMac in September 2000. The company was in deep doo doo and being poorly managed at the time. It fell another 12% thereafter before finally bottoming out. Who knew it go up split adjusted from $1.30 from that point to $279 today? Smartphones did not exist and Steve Jobs was not yet back at the helm.

So now we are about to enter the ROARING 20's again. I wish everyone much success and hope we all do well.

ps. Sell everything by October 2029. LOL!

No, you're wrong on the Apple timeline. Apple did fall drastically in fall of 2000 after reporting a loss due to poor sales of Power Mac G4 Cube. The stock fell like 80%. I remember watching it from the sideline and became very interested in Apple stock after I read the quarterly report. I couldn't believe what I saw from the market after reading that report. Apple stock had fallen so much that it was trading at cash value. Apple at the time had $4 billion in the bank and zero debt. After the haircut, the total market cap of Apple was $4 billion. Basically, Wall Street was saying Apple stock was worth nothing and the only value it had was the $4 billion cash it had in the bank. I thought that was crazy and started buying Apple stock like crazy. At the end of December 2000, Apple stock traded as low as $13 7/8 presplit. I know because I bought 15,000 shares of Apple during that December at around $14 a share. Remember, this is all presplit price. Apple has since split 2 for 1 and than later another 7 for 1 split. If I had kept those 15,000 shares, I would've 210,000 shares of Apple today. When I bought Apple, it was $4 billion company trading only at its cash value. Wall Street and every analysts hated Apple. So did everyone else. The amount of daily FUD about Apple going out of business was incredible and Apple had like 15% float short when it was trading at strictly cash value. That's how bad the sentiment against Apple was.

But I remember how determined Steve Job was to bring Apple back to profitability. Steve Job had returned to Apple in 1997 and totally saved them and brought out hit after hit products. iMac is huge success. Then he brought out the iBook which I bought in 1999. Apple started reporting profit every quarter under Steve Jobs until he released his first failure, Power Mac G4 Cube in 2000. The Power Mac G4 Cube was Steve Job's baby and he didn't want to admit he was wrong about the design of that computer. I loved the design of the Cube but it wasn't very practical. So it didn't sell. Apple reported like another 2 quarters of losses before they started reporting profits every quarter again. They introduced the iPod which I bought early on and knew it was going to be a hit and takeover the portable music market. But I ended up selling those 15,000 Apple shares to buy a restaurant. That was one of the dumber moves of my life but at the time, I couldn't in my wildest dream imagine Apple being worth $1.3 trillion today. I thought if Apple reached $100 billion, that would've been great.

I mentioned before, I'm not going to make the same mistake with Tesla like I did with Apple and sell early. I got into Tesla later than I did with Apple because for years I thought Tesla was a joke and would surely fail and go out of business. Just like I didn't think SpaceX would succeed. By the time I realized how wrong I had been with Tesla and SpaceX, Tesla was already expensive at around $40 billion marketcap. I have 1,500 shares of Tesla and my plan is to continuously add to it over the years. I have little doubt that Tesla will be the next trillion dollar company.