Category Archives: Daily Market Update

Daily Market Update – June 21, 2016 (8:00 AM)

Yesterday was a day when almost everything came together in a positive way, including rising oil prices not putting downward pressure on stocks.

Basically, it was a kind of fantasy land and people were gladly buying, even though about 50% of the earlier gains in the US were lost and even at their peak they didn’t match gains in European markets.

The rest of the week has lots of talk, a big vote and not too much else.

Janet Yellen gives 2 days of mandatory congressional testimony and Stanley Fischer, he co-Chairman, who has been oddly quiet of late, also speaks.

Of course, the real big event is likely to be the vote on whether Great Britain should leave the European Union.

Based on recent polling, there seems to be a sudden shift against leaving and markets are finding reason to cheer.

Hopefully, even as that drives volatility lower, I hope that the reasons to cheer continue, as I don’t mind seeing my net asset value play some catch up, as oil and commodities make up a small bit of their immense lost ground.

I did make an opening trade yesterday and that may be it for the week.

That position goes ex-dividend early next week and I wouldn’t mind losing it to early assignment and [pocketing the entire month’s worth of premium for only 6 days of holding.

That would be nice, but trying to predict a week out is as useless as trying to predict today.

Ahead of Janet Yellen’s first day in front of Congress, the futures are again pointing higher, as there appears to be no one really thinking that the good news will stop, even as there’s really no good news.

What the market has been reacting to is a continued pause in interest rates and status quo in the European Union.

I suppose the absence of bad news is good news, although the continued pause in interest rates may reflect some actual bad news.

Following some real hedging inspired spin by Janet Yellen her past 2 appearances, it will be interesting to see how she is questioned today and tomorrow.

It can’t be easy to say nothing, but it must be even harder to play both sides of the room and try to end up balancing things out.

I hope that there continues to be some strength only so that I can see asset value climb and maybe get a chance to sell some new cover on positions adding nothing to my personal wealth.

Otherwise, I’m just tuned in and am prepared for a personally passive week.

Daily Market Update – June 20, 2016 (Close)

What a difference a poll makes.

Mid week of just a few days ago the numbers seemed to be increasing on the “exit” side of the vote. With the increasing certainty that a British withdrawal from the European Union was going to be the case, there was the usual disagreement about what that would mean and then how long it would take for anything to really happen.

As they were all debating those issues, London’s bookies were still leaning fairly strongly in the other direction.

As the week came to its close the sentiment was reportedly shifting, perhaps due to the tragic shooting of a member of Parliament in a country where shootings are exceedingly rare.

This morning, with just days to go the polls were catching up with the bookies and markets all over the world wee voting with their local currencies and buying stocks.

To me it seemed odd that so soon after being against Scotland’s withdrawal from Great Britain, there would even be discussion about withdrawal from the European Union. You would think that the reasons voiced against Scotland’s proposed move would hold fro Britain’s proposed move.

This morning all of the world’s market’s were much higher. Our own, as the futures were getting closer to the opening bell is actually the laggard, even as it was up by more than 1%.

Even as the market finished nearly 50% off from its intra-day highs, it was better than some of the alternatives.

I’m not one to buy stocks on a Monday when the market has such a climb, so my hope today was that the tide carries many along with it and perhaps offers some opportunities to sell calls on existing and uncovered positions.

Instead, I did get carried along, but while no opportunities to sell calls on uncovered positions came to be, there was one opportunity that seemed too good to pass up.

That was upon seeing the sharp decline in shares of Cypress Semiconductor after it announced the issuance of a convertible offering.

So often those initial reactions are so, so overdone. With its dividend coming up next week and earnings not until the August 2016 option cycle, I wouldn’t mind shares being assigned early, but can wait out the month, as well.

For one, I wouldn’t mind the first week of summer continuing the general pattern of 2016, even if that means no more days with the promise of broad big gains, such as today.

That hasn’t resulted in very much trading for me, but at least it has allowed some catch-up after the commodity and energy related losses in 2015.

With summer getting underway and perhaps both interest rates and “Brexit” being put to rest for a little while, I’d like to see some seasonal strength in energy prices drag the market higher, as they’ve been doing through most of 2016.

Daily Market Update – June 20, 2016 (9:00 AM)

What a difference a poll makes.

Mid week of just a few days ago the numbers seemed to be increasing on the “exit” side of the vote. With the increasing certainty that a British withdrawal from the European Union was going to be the case, there was the usual disagreement about what that would mean and then how long it would take for anything to really happen.

As they were all debating those issues, London’s bookies were still leaning fairly strongly in the other direction.

As the week came to its close the sentiment was reportedly shifting, perhaps due to the tragic shooting of a member of Parliament in a country where shootings are exceedingly rare.

This morning, with just days to go the polls are catching up with the bookies and markets all over the world are voting with their local currencies and buying stocks.

To me it seemed odd that so soon after being against Scotland’s withdrawal from Great Britian, there would even be discussion about withdrawal from the European Union. You would think that the reasons voiced against Scotland’s proposed move would hold fro Britain’s proposed move.

This morning all of the world’s market’s are much higher. Our own, as the futures are getting closer to the opening bell is actually the laggard, even as it is up by more than 1%.

I’m not one to buy stocks on a Monday when the market has such a climb, so my hope is that the tide carries many along with it and perhaps offers some opportunities to sell calls on existing and uncovered positions.

For one, I wouldn’t mind the first week of summer continuing the general pattern of 2016.

That hasn’t resulted in very much trading for me, but at least it has allowed some catch-up after the commodity and energy related losses in 2015.

With summer getting underway and perhaps both interest rates and “Brexit” being put to rest for a little while, I’d like to see some seasonal strength in energy prices drag the market higher, as they’ve been doing through most of 2016.

Daily Market Update – June 17, 2016 (7:00 AM)

The Week in Review will be posted by 10 PM and the Weekend Update will be posted by Noon on Sunday:

The following trade outcomes are possible today:

Assignments:   none

Rollovers:  MRO

Expirations:  DOW, HPQ, UAL

The following were ex-dividend this week:  M (6/13 $0.38), HPQ (6/13 $0.12), BBBY (6/14 $0.12)

The following will be ex-dividend next week:  LVS (6/20 $0.72), JOY (6/20 $0.01)

Trades, if any, will be attempted to be made prior to 3:30 PM EDT

Daily Market Update – June 16, 2016 (Close)

Yesterday was in sharp contrast to the way the previous day came to its close.

Today was in sharp contrast to itself.

Yesterday, immediately after Janet Yellen’s press conference concluded, the market sold off what modest gains it had made and ended the day lower.

While she spoke, the market pretty much treaded water. It had rallied upon the release of the FOMC Statement, but then really didn’t know what to make of the increasingly dovish tone adopted by Yellen and it just traded in a narrow range through the prepared text and the question and answer period.

But when it all ended came the realization that if the economy wasn’t good enough to support even a 0.25% interest rate increase, maybe it’s not good enough to be a place to park your money.

If your job was to record events, the uptick and the downturn were very easily identifiable as were their causes.

Today, the change, from a decidedly negative open to a close just off of its decideldly positive highs wasn’t as easy to pinpoint as to its catalyst.

This morning’s futures were just modestly weaker as overseas markets had a rough session and oil is again falling.

Using those as guides, we were looking to open on the negative, but still faring far better in comparison to others around the world.

When the end came, that distinction to what was going on elsewhere was cemented and gave a little bit of hope for me as far as tomorrow’s monthly ending option cycle goes.

My aspirations are still meek, though.

I would just like to rollover a position or 2 or see an assignment or two.

With a number of losing sessions having been strung together before today’s surprising gain, those aspirations are getting a little more difficult, but as the market’s recent weakness has driven volatility higher, there may at least be some opportunity to get some relatively larger premiums and look at longer term expiration dates to lock in those premiums while awaiting what is hopefully coming.

Hopefully, tomorrow will see it fit to add a little more to today’s gains and make July a little easier to swallow.

.

Daily Market Update – June 16.5, 2016 (7:00 AM)

Yesterday was in sharp contrast to the way the previous day came to its close.

Yesterday, immediately after Janet Yellen’s press conference concluded, the market sold off what modest gains it had made and ended the day lower.

While she spoke, the market pretty much treaded water. It had rallied upon the release of the FOMC Statement, but then really didn’t know what to make of the increasingly dovish tone adopted by Yellen and it just traded in a narrow range through the prepared text and the question and answer period.

But when it all ended came the realization that if the economy wasn’t good enough to support even a 0.25% interest rate increase, maybe it’s not good enough to be a place to park your money.

If your job was to record events, the uptick and the downturn were very easily identifiable as were their causes.

This morning’s futures are just modestly weaker as overseas markets had a rough session and oil is again falling.

Using those as guides, we may have fared quite well yesterday in comparison to others around the world.

With just 2 days remaining in the week, my aspirations are meek.

I would just like to rollover a position or 2 or see an assignment or two.

With a number of losing sessions now being strung together each of those aspirations is getting a little more difficult, but as the market’s weakness drives volatility higher, there may at least be some opportunity to get some relatively larger premiums and look at longer term expiration dates to lock in those premiums while awaiting what is hopefully coming.

.

Daily Market Update – June 15, 2016 (Close)

Yesterday ended much better than it had been looking earlier in the day.

With a reasonably strong loss on Monday, had the losses continued to that degree on Tuesday, there would have been some good chance of getting some kind of relief rally on Wednesday, almost regardless of what would have been contained in the FOMC Statement release.

With some early morning strength, almost enough to offset yesterday’s loss, that could have left markets easily going in either direction at 2 PM and maybe even again afterward, as Janet Yellen was to hold her press conference.

The expectation seems to be that there may be more dove than hawk today both from the statement itself and then during the press conference.

Unless a real shocker were to come and interest rates were raised, there wasn’t too much reason for the market to behave badly.

That is, unless another bombshell were to hit, such as any mention of the word “recession.”

That latter bombshell seemed very unlikely, but it’s the unlikely that gets people’s attention and flames fears or greed.

For today, I would have  just liked to have see something that helped the market move higher.

That’s not the way it worked out, though.

As it was, there wasn’t much chance of me spending any money prior to the FOMC and not much likelihood of doing so after the press conference.

What we saw was the market hit its high point right at the release, although not a really tremendous gain, no matter how you looked at it and then fall to close at its lows beginning immediately after the end of the press conference.

What can we learn from that behavior?

Nothing, except that maybe traders realized that dovishness at this point isn’t reflective of the kind of economy to write home about.

At this point, I’d just like to see this week come to an end and get the July 2016 option cycle going.

Daily Market Update – June 15, 2016 (8:00 AM)

Yesterday ended much better than it had been looking earlier in the day.

With a reasonably strong loss on Monday, had the losses continued to that degree on Tuesday, there would have been some good chance of getting some kind of relief rally on Wednesday, almost regardless of what would have been contained in the FOMC Statement release.

With some early morning strength, almost enough to offset yesterday’s loss, that leaves markets easily going in either direction at 2 PM and maybe even again afterward, as Janet Yellen holds her press conference.

The expectation seems to be that there may be more dove than hawk today both from the statement itself and then during the press conference.

Unless a real shocker comes and interest rates are raised, there’s not too much reason for the market to behave badly.

That is, unless another bombshell hits, such as any mention of the word “recession.”

That latter bombshell seems very unlikely, but it’s the unlikely that gets people’s attention and flames fears or greed.

For today, I would just like to see something that helps the market move higher.

There’s not much chance of me spending any money prior to the FOMC and not even likely until after the press conference.

At this point, I’d just like to see this week come to an end and get the July 2016 option cycle going.

Daily Market Update – June 14, 2016 (Close)

The week looked like it may get off to a weaker start as we awaited Wednesday’s FOMC Statement release.

What wasn’t totally expected was just how weak it would get as the market fell back in line with the price of oil, something it hadn’t really done in the past 2 weeks.

There was also the pressure of very weak global markets and the strength of Treasury Notes, but the connection to oil was inescapable yesterday.

The market was sharply lower, then positive and then finished the day sharply lower.

All of that was in perfect concert with oil’s moves.

Today, in the futures trading, oil was again weak, but the market wasn’t as low as it could be.

For a while it looked as if today might end up being just as weak or even weaker than on Monday, but markets did rally somewhat to just end the day as a mediocre one and not one with anything memorable.

Maybe there was a little more focus on interest rates, but we really won’t get any news until tomorrow.

After that event and Janet Yellen’s press conference, attention can then turn to Great Britain and its vote on whether to remain part of the European Union.

That of course will be quickly forgotten as we then move onto something else, like maybe the upcoming Employment Situation Report and how upward revisions could lead to something substantive coming from July’s FOMC meeting.

But there’s still the rest of this week to deal with.

I added more oil in the hopes of continuing to take advantage of those steep premiums.

Even if the timing proves to be wrong, those premiums make it easier to wait until the timing is no longer an issue.

I don’t think that I’ll be spending any more money this week, but you never know.

I’d be very happy to simply generate some rollover income for the week and as with yesterday’s rollover of a deep in the money position, right now, I’d rather take the premiums than take assignment, even as that would add to cash reserves.

Otherwise, there’s probably not much to watch today and maybe even less to do.

Unless there are some big surprises tomorrow, maybe even if only in the words used to describe the economy, there isn’t much reason for any large moves, although reason is usually not necessary.

Tomorrow may be another day for stocks to try and overcome some resistance, if the news is interpreted as being good.

I think that I will just be a bystander.

Daily Market Update – June 14, 2016 (8:15 AM)

The week looked like it may get off to a weaker start as we awaited Wednesday’s FOMC Statement release.

What wasn’t totally expected was just how weak it would get as the market fell back in line with the price of oil, something it hadn’t really done in the past 2 weeks.

There was also the pressure of very weak global markets and the strength of Treasury Notes, but the connection to oil was inescapable yesterday.

The market was sharply lower, then positive and then finished the day sharply lower.

All of that was in perfect concert with oil’s moves.

Today, in the futures trading, oil is again weak, but the market isn’t as low as it could be.

Today, maybe there will be a little more focus on interest rates, but we really won’t get any news until tomorrow.

After that event and Janet Yellen’s press conference, attention can then turn to Great Britain and its vote on whether to remain part of the European Union.

That of course will be quickly forgotten as we then move onto something else, like maybe the upcoming Employment Situation Report and how upward revisions could lead to something substantive coming from July’s FOMC meeting.

But there’s still the rest of this week to deal with.

I added more oil in the hopes of continuing to take advantage of those steep premiums.

Even if the timing proves to be wrong, those premiums make it easier to wait until the timing is no longer an issue.

I don’t think that I’ll be spending any more money this week, but you never know.

I’d be very happy to simply generate some rollover income for the week and as with yesterday’s rollover of a deep in the money position, right now, I’d rather take the premiums than take assignment, even as that would add to cash reserves.

Otherwise, there’s probably not much to watch today and maybe even less to do.

Unless there are some big surprises tomorrow, maybe even if only in the words used to describe the economy, there isn’t much reason for any large moves, although reason is usually not necessary.

Daily Market Update – June 13, 2016 (Close)

The week looked like it may get off to a weaker start as we awaited Wednesday’s FOMC Statement release.

There’s not likely to be any movement on interest rates coming out of that meeting, although lots of attention is also paid to any slight nuances that may come from changed wording.

More importantly, though, may be the tone taken by Chairman Yellen during her press conference later on Wednesday afternoon.

While we awaited those events, the Asian markets were down 3% overnight and oil was down again this morning, as it had difficulty with the $50 level, just as the DJIA and S&P 500 had difficulty with the 18000 and 2100 levels, respectively.

What became very clear today was that oil was in charge, as the market followed it lockstep throughout the day, resulting in a wide trading range.

WIth a few positions set to expire this week, I was just hoping to be able to put them to work if they’re not assigned.

I was surprised to make a rollover trade today, but I decided to keep the Goldminer ETF position set to expire this week, rather than taking a likely assignment. When thinking about it, the risk was that over the next 5 weeks it would have to fall about 16% to become out of the money. In return for that risk I could get an additional 2% premium.

There was a time that I would scoff at 2% for a 5 week period, but these days?

I’ll take it.

For some of those remaining positions assignment seems unlikely, so it may be back to looking at some longer term time frames in an effort to buy time and get paid for doing so.

In the event that Wednesday becomes a non-event, oil may again become prominent in our markets and if the association continues, it wouldn’t be too surprising to see oil take a break, even as summer demand may be increasing.

In the meantime, with each passing day over the next week or so, there can also be lots more attention being paid to Great Britain’s upcoming vote on its EU membership.

There’s lots of hyperbole on that topic and it’s anyone’s guess what that might due to international markets and our own.

With just a little bit of discretionary cash and some uncertainty this week, I wasn’t entirely convinced that I’d be opening any new positions this week, although I was prepared to add an oil position, despite being over-invested in that sector.

Funny thing.

I made that purchase, maybe because I didn’t want to go three consecutive weeks without a new position.

That’s a bad reason.

A better reason was, that even if wrong about the near term direction of its movement, the option premium is so large, and the option market generally so liquid, that there may not be too much difficulty riding out any short term storm.

Otherwise, this may be another week of being a passive bystander and maybe just hoping that asset value climbs as the market tries to figure out what is really important.

Daily Market Update – June 13, 2016 (Close)

The week looked like it may get off to a weaker start as we awaited Wednesday’s FOMC Statement release.

There’s not likely to be any movement on interest rates coming out of that meeting, although lots of attention is also paid to any slight nuances that may come from changed wording.

More importantly, though, may be the tone taken by Chairman Yellen during her press conference later on Wednesday afternoon.

While we awaited those events, the Asian markets were down 3% overnight and oil was down again this morning, as it had difficulty with the $50 level, just as the DJIA and S&P 500 had difficulty with the 18000 and 2100 levels, respectively.

What became very clear today was that oil was in charge, as the market followed it lockstep throughout the day, resulting in a wide trading range.

WIth a few positions set to expire this week, I was just hoping to be able to put them to work if they’re not assigned.

I was surprised to make a rollover trade today, but I decided to keep the Goldminer ETF position set to expire this week, rather than taking a likely assignment. When thinking about it, the risk was that over the next 5 weeks it would have to fall about 16% to become out of the money. In return for that risk I could get an additional 2% premium.

There was a time that I would scoff at 2% for a 5 week period, but these days?

I’ll take it.

For some of those remaining positions assignment seems unlikely, so it may be back to looking at some longer term time frames in an effort to buy time and get paid for doing so.

In the event that Wednesday becomes a non-event, oil may again become prominent in our markets and if the association continues, it wouldn’t be too surprising to see oil take a break, even as summer demand may be increasing.

In the meantime, with each passing day over the next week or so, there can also be lots more attention being paid to Great Britain’s upcoming vote on its EU membership.

There’s lots of hyperbole on that topic and it’s anyone’s guess what that might due to international markets and our own.

With just a little bit of discretionary cash and some uncertainty this week, I wasn’t entirely convinced that I’d be opening any new positions this week, although I was prepared to add an oil position, despite being over-invested in that sector.

Funny thing.

I made that purchase, maybe because I didn’t want to go three consecutive weeks without a new position.

That’s a bad reason.

A better reason was, that even if wrong about the near term direction of its movement, the option premium is so large, and the option market generally so liquid, that there may not be too much difficulty riding out any short term storm.

Otherwise, this may be another week of being a passive bystander and maybe just hoping that asset value climbs as the market tries to figure out what is really important.

Daily Market Update – June 13, 2016 (7:30 AM)

The week looks like it may get off to a weaker start as we await Wednesday’s FOMC Statement release.

There’s not likely to be any movement on interest rates coming out of that meeting, although lots of attention is also paid to any slight nuances that may come from changed wording.

More importantly, though, may be the tone taken by Chairman Yellen during her press conference later on Wednesday afternoon.

While we await those events, the Asian markets were down 3% overnight and oil is down again this morning, as it had difficulty with the $50 level, just as the DJIA and S&P 500 had difficulty with the 18000 and 2100 levels, respectively.

WIth a few positions set to expire this week, I just hope to be able to put them to work if they’re not assigned.

For some of those positions that seems unlikely, so it may be back to looking at some longer term time frames in an effort to buy time and get paid for doing so.

In the event that Wednesday becomes a non-event, oil may again become prominent in our markets and if the association continues, it wouldn’t be too surprising to see oil take a break, even as summer demand may be increasing.

In the meantime, with each passing day over the next week or so, there can also be lots more attention being paid to Great Britain’s upcoming vote on its EU membership.

There’s lots of hyperbole on that topic and it’s anyone’s guess what that might due to international markets and our own.

With just a little bit of discretionary cash and some uncertainty this week, I’m not entirely convinced that I’ll be opening any new positions this week, although I still might like to add an oil position, despite being over-invested in that sector.

That may be a place, that even if wrong about the near term direction of its movement, the option premium is so large, and the option market generally so liquid, that there may not be too much difficulty riding out any short term storm.

Otherwise, this may be another week of being a passive bystander and maybe just hoping that asset value climbs as the market tries to figure out what is really important.

Daily Market Update – June 10, 2016 (7:30 AM)

The Week in Review will be posted by 10 PM and the Weekend Update will be posted by Noon on Sunday.

The following trade outcomes are possible today”

Assignments:  none

Rollovers:   none

Expirations:  HFC

The following were ex-dividend this week:   HPQ (6/6 $0.12),KSS (6/6 $0.50), NEM (6/7 $0.025), GM (6/8 $0.38), WY (6/8 $0.31), BBY (6/10 $0.28)

The following will be ex-dividend next week:  BBBY (6/15 $0.125)

Trades, if any, will be attempted to be made by 3:30 PM EDT

Daily Market Update – June 9, 2016 (Close)

After 3 consecutive days higher, no doubt inspired by the lack of any clarity from Janet Yellen on Monday, the market was getting ready for a rest this morning and it stayed that way throughout the day, ending a 3 day winning streak.

As it did, the S&P 500 still sits only about 1% away from its all time closing high.

With the greatest likelihood that there will be no interest rate increase being announced next week and investors making it clear that they prefer that to be the case, even as they give some sign of accepting that increase, there isn’t much to hold the market back.

Except of course for that pesky thing that so many algorithms and traders use.

Charts.

Just as the 18000 level on the DJIA has been a barrier, so too is the 2137 level on the S&P 500.

People talk about triple tops and the bearish indicator that is, but after some failed attempts the DJIA did get beyond its 18000 level, although it has yet to do so convincingly. The same considerations lies ahead for the S&P 500.

With little economic news in the very near term, all we really have ahead is the FOMC meeting next week and then the usual events in the coming month of July.

At this point most everyone wants to see whether last week’s Employment Situation Report was simply an aberration and signifying nothing.

You can bet that if the next one, or even the GDP comes in big, there will be a big reaction.

It may still be a mystery, though, how traders would react.

With such bad news last week and the rumblings of that kind of a number being associated with a recession, some may find a strong higher number to be a major disappointment.

Who knows?

While I’m not trading, I am happy to see asset values climb, particularly as there is a rebound in oil and commodities.

Those led me down and now are leading me higher, but I wouldn’t mind getting out of some of those positions at this point and looking for a re-entry opportunity.

Otherwise, the week hinges on a sole position set to expire and hoping that it can still be rolled over and milking it for every last bit of premium until its own expiration.

With the Baker-Hughes Rig Count coming out at 1 PM tomorrow and with that single expiring position still being within range of both rollover and assignment, and maybe even expiration, I might be inclined to not wait to have the rig count take me out for the count.

Ultimately those premiums do add up, so I wouldn’t mind adding some more, but I would still much rather be actively exploring and opening new positions.

Still, money is money.