12:15pm (EST)

The market is mixed as we head into the second half of trading as Apple (AAPL, $442.92, up $23.93) has lead Tech higher while Caterpillar (CAT, $84.25, down $1.27) is weighing on the blue-chips.  The head zombie will be speaking later this afternoon on his economic plan and jobs and his choice words could have an impact on the market.  The President’s approval rate is at 45% and sinking and we expect much of the same old rhetoric.  The “shovel ready” jobs Obama promised over 4 years ago are still coming…

As far as corporate earnings, Apple reported a profit of $7.47 a share on revenue of $35.3 billion versus expectations for $7.32 a share on sales of $35 billion.  We had a good read on the company’s numbers as we said Mac sales would be down, they were, as the 3.8 million units sold were down from 4 million in last year’s quarter.  We mentioned this would be offset by stronger-than-expected iPhone sales and it was as Apple sold 31.2 million for the quarter versus 26 million a year ago.

Gross Margins slipped from 42.6% last year to 36.9%.  Apple also declared a cash dividend of $3.05 for the quarter and is payable on August 15 for shareholders who own the stock by August 12.  The company expects a busy Fall season but was mums on the subject of product development said and said they will have an update in October for Wall Street.

We didn’t feel as though shares would fall off a cliff without a major product announcement (or a stock-split),  and we didn’t expect shares to zoom 10% either.  The option premiums were too rich for us to play a near-term bullish or bearish move so we sat on the sidelines.

Caterpillar is down 2% and is accounting for a 12-pack of the Dow’s losses after the company missed analysts estimates by 25 cents.  CAT reported a profit of $1.45 a share on revenue of $14.62 billion while the suit-and-ties were looking for $1.70 a share/ $14.92 billion in revenue.

We were cheerleading for higher prices at the open because we are long Tech and a few other name.  We have done well playing call options since late April but we are not digging today’s action.  We have given you a ton of clues to watch for on a downside break but we will continue to stick with the trend until it ends.  The indexes have come off their lows and the Nasdaq has held green all day, albeit, by a slim margin.

The Dow is off 18 points to 15,549 while the S&P 500 is down 3 points to 1,689 after testing 1,698 again.  The Nasdaq is higher by 13 points to 3,592.

We have taken extra steps on our profitable trades to lock-in profits and our portfolio is still light as we wait to play a continued breakout, or as the knuckleheads have warned cv all year, a 5%-10% pullback.  At some point, we could get another test to the 100-day MA’s (moving averages), but for now, we will continue milking the cow with call options.

Subscribers, check the Members Area for the updates and please adjust you trades and Hard Stops to protect profits.  We could also have additional New Trades and or Profit Alerts this afternoon so stay close to your email inboxes!