Purchase QQQ Puts and SCHN Puts

Today I pull the trigger and after watching the market all morning I purchase QQQ and SCHN puts. Now normally I would have bought QQQ close to the end of Friday and already made 30% with the drop today but the setup was different...it was a coiled spring.
I do not feel that the coiled spring has fully blown yet, either. So I put my money where my mouth is and purchase the puts anyway. I am also aware that seeing that the market has not fully committed to the spring pop that things are most likely going to chop and tomorrow there will be a test rebound. In this case I would just purchase more QQQ puts at an additional 30 % off and then have more for the drop. Its really all about measuring the most likely outcomes and not knowing for 100% sure, grabbing yourself down there and going for it. Charging ahead knowing that you will be right 80% of the time will yield you long term results. Below is my QQQ entry:

So onto the next order for the day, SCHN. This company is most likely going to have a terrible earnings report. At least a report that won't support the price that the stock is at now. Also, there was an overreaction to a upgrade this past week:
Schnitzer Steel Industries Inc. (NASDAQ: SCHN) was having a solid Monday with a 5% gain to $18.55 after KeyBanc Capital Markets lifted its prior Sector Perform rating up to Overweight, and the firm’s $25.00 price target implied upside of 43% from the $17.54 prior closing price. Schnitzer has suffered with other steel companies, and KeyBanc sees its metals recycling bottom is close. Schnitzer’s 52-week range is $15.06 to $28.44. The company also has an accidentally high dividend yield above 4%, and its consensus price target is only at $16.00 here. In fact, this is a street-high target, above the prior high of $18 from analysts.


As you can see the analyst still thinks this stock is overweight. The dividend is high, which also has the stock trading a bit high right now. Now if the stock has earnings that match this:

Look at that mess. See the growth est for SCHN for this quarter? Now see some of the big epic misses for the last 4 quarters, especially the last 2? What this tells me is that with the price trading relatively high and if the stock does come out with something poor, the price is going to drop fairly big. At least its the correct gamble to take. Death and taxes are the only non-gambles in life. Below is our in order.

So this is what we are in today. I will also be looking at the most up lists for any possible bounce situation as I feel that the Nasdaq will be going down overall for the week.