Category Archives: Daily Market Update

Daily Market Update – December 21,  2015  (Close)

Whatever promise last week had was quickly dashed on Thursday and Friday when the market fell about 3.5% after having climbed nearly that amount in the first 3 days of the week.

While that pretty much sounds like a breakeven it comes after a week that had a nearly 4% loss, that came after 2 weeks of virtually no movement, that themselves came after a week with a 3.5% gain.

That’s been the story of the year. Up, down, nothing, up and down and over again, except in no identifiable order.

Today, though, it ended up being up, down, and up.

Lots of activity, but without any guiding theme and with little net movement.

As we get to enter the final 2 weeks of trading, minus 2 of the 10 days that are ordinarily in a two week period, due to Christmas and New Year’s celebrations, there’s still a chance for the year to end up on the positive side, to end up deeper in the hole or to go nowhere.

Any of those would be plausible.

This morning the pre-opening futures were trading nicely ahead, even as oil futures were again falling sharply.

For over a year those dropping oil futures would have dragged the market down along with it, much in contrast to what history would have predicted.

Obviously, a single day isn’t the sort of things that patterns are made of, but if the market can finally come to an embrace of rising interest rates, maybe it can also come to the realization that falling energy rates can be good for the economy, too.

Both the interest rate issue and those falling energy prices have been long considered to be reasons to sell stocks, rather than as a sign of an improving economy. In this case, as long as those energy prices have been falling because supply has been increasing, should be enough to make people feel good about things.

But that just hasn’t been the case for the 15 months of declining energy prices. The decoupling of the normal relationship between the two has really been striking and fairly irrational.

A return to rationality might be a nice way to close out the year and we may get a clue as to just how strongly the market may be prepared to embrace interest rate increases as GDP is released this week along with some other data that reflect economic growth, such as home sales, durable goods orders and jobs.

Strong numbers across the board should lead to a buying spree, as long as they’re not wildly strong. But still, you never know, just as the week after the Employment Situation Report came as a complete surprise as the market gave up on all of its initial embrace.

This week I expect to be doing little differently from the past 2 weeks, when I opened only a single new position.

I don’t expect to be spending too much money this week and would be very satisfied if I could get some assignments and rollovers of the  4 positions expiring this week. With a smattering of positions also expiring in the other weeks of January, leading up to a large number of positions expiring during the final week of the January 2016 cycle, I’d like to be able to avoid adding any to that week, if rolling over.

With any strength that the market can show and more importantly, sustain, I’d much rather be able to sell calls on uncovered positions than to put any more cash at risk, especially while there’s not too much cash to go around.

Today was just another head scratcher.

After giving up a substantial gain and then trading listlessly for much of the day, the market pulled it all together and closed respectably.

Tomorrow? Who knows, but look for the GDP before the market opens to set the tone.

Daily Market Update – December 21,  2015  (8:00 AM)

Whatever promise last week had was quickly dashed on Thursday and Friday when the market fell about 3.5% after having climbed nearly that amount in the first 3 days of the week.

While that pretty much sounds like a breakeven it comes after a week that had a nearly 4% loss, that came after 2 weeks of virtually no movement, that themselves came after a week with a 3.5% gain.

That’s been the story of the year. Up, down, nothing, up and down and over again, except in no identifiable order.

Lots of activity, but without any guiding theme and with little net movement.

As we get to enter the final 2 weeks of trading, minus 2 of the 10 days that are ordinarily in a two week period, due to Christmas and New Year’s celebrations, there’s still a chance for the year to end up on the positive side, to end up deeper in the hole or to go nowhere.

Any of those would be plausible.

This morning the pre-opening futures are trading nicely ahead, even as oil futures were again falling sharply.

For over a year those dropping oil futures would have dragged the market down along with it, much in contrast to what history would have predicted.

Obviously, a single day isn’t the sort of things that patterns are made of, but if the market can finally come to an embrace of rising interest rates, maybe it can also come to the realization that falling energy rates can be good for the economy, too.

Both the interest rate issue and those falling energy prices have been long considered to be reasons to sell stocks, rather than as a sign of an improving economy. In this case, as long as those energy prices have been falling because supply has been increasing, should be enough to make people feel good about things.

But that just hasn’t been the case for the 15 months of declining energy prices. The decoupling of the normal relationship between the two has really been striking and fairly irrational.

A return to rationality might be a nice way to close out the year and we may get a clue as to just how strongly the market may be prepared to embrace interest rate increases as GDP is released this week along with some other data that reflect economic growth, such as home sales, durable goods orders and jobs.

Strong numbers across the board should lead to a buying spree, as long as they’re not wildly strong. But still, you never know, just as the week after the Employment Situation Report came as a complete surprise as the market gave up on all of its initial embrace.

This week I expect to be doing little differently from the past 2 weeks, when I opened only a single new position.

I don’t expect to be spending too much money this week and would be very satisfied if I could get some assignments and rollovers of the  4 positions expiring this week. With a smattering of positions also expiring in the other weeks of January, leading up to a large number of positions expiring during the final week of the January 2016 cycle, I’d like to be able to avoid adding any to that week, if rolling over.

With any strength that the market can show and more importantly, sustain, I’d much rather be able to sell calls on uncovered positions than to put any more cash at risk, especially while there’s not too much cash to go around.

Daily Market Update – December 18,  2015  (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: none

Expiration:  BBBY, DOW, F, GDX, HPQ, IP, UAL, WMT

The following were ex-dividend this week:

The following will be ex-dividend next week:  none

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

Daily Market Update – December 17,  2015  (Close)

Yesterday was the day that many had expected since January 2015.

The speculation about when interest rates would finally be lifted ended yesterday.

Waiting for that day actually began right near the end of Ben Bernanke’s tenure and has been ever-present since Janet Yellen assumed the Chairmanship of the Federal Reserve.

It finally happened yesterday, but in a smaller than historical level of rate increase.

For most of the time that people have been expecting the increase, the expectation has been that it might be a very small one and that it might also be of the “one and done” variety.

Yet despite the relatively innocuous nature of such an increase, the predominant market reaction to the expectation for it ever happening has been overwhelmingly negative.

Only on 2 occasions in all of that time has there been a positive response to the likelihood of that rate increase and the second one is one that we were in the midst of this past week.

Instead of selling on the news the market celebrated, but mostly that additional celebration after the FOMC Statement release occurred during Janet Yellen’s press conference, as she gave reason to believe that the FOMC viewed the economy as being stronger than many believed.

This morning’s futures trading indicated a continuation of the rally that started in the final hour of Monday’s trading.

Finding some additional strength as the week comes to its end and as the monthly options cycle comes to its end would have been nice, especially as each day has brought positions a little but closer to the possibility of some rollovers.

That too would have been nice as many of those had calls sold on them a few months ago, also selling those calls into some market strength in a hope that time would bring some price recovery.

That recovery, though, has been slow and it slowed down even more today as the DJIA lost  253 points.

Why did it lose 253 points? Maybe it was a very delayed sell on the news kind of thing, but  it really made no sense, as the selling started within minutes of the opening bell and just got worse and worse.

Even as the market has challenged reaching and surpassing its August high levels, the reality remains that market strength continues to be concentrated in a relatively small number of names and the number of stocks that have been and continue to be in correction or bear mode is staggering.

That may be the real theme of 2015, although when it’s all written most focus will probably go toward the fact that 2015 was the year in which interest rates were finally raised.

That will omit the real nature of this year that still sits right near the flat line, but only thanks to those small number of positions in the DJIA and S&P 500  that have performed very well.

Today, even those got rocked.

Hopefully tomorrow will again bring us closer to making some income generating trades as we head into a Christmas shortened trading week, but I’m not as optimistic as I was 24 hours ago.

Daily Market Update – December 17,  2015  (7:30 AM)

Yesterday was the day that many had expected since January 2015.

The speculation about when interest rates would finally be lifted ended yesterday.

Waiting for that day actually began right near the end of Ben Bernanke’s tenure and has been ever-present since Janet Yellen assumed the Chairmanship of the Federal Reserve.

It finally happened yesterday, but in a smaller than historical level of rate increase.

For most of the time that people have been expecting the increase, the expectation has been that it might be a very small one and that it might also be of the “one and done” variety.

Yet despite the relatively innocuous nature of such an increase, the predominant market reaction to the expectaion for it ever happening has been overwhelmingly negative.

Only on 2 occasions in all of that time has there been a positive response to the likelihood of that rate increase and the second one is one that we were in the midst of this past week.

Instead of selling on the news the market celebrated, but mostly that additional celebration after the FOMC Statement release occurred during Janet Yellen’s press conference, as she gave reason to believe that the FOMC viewed the economy as being stronger than many believed.

This morning’s futures trading indicates a continuation of the rally that started in the final hour of Monday’s trading.

Finding some additional strength as the week comes to its end and as the monthly options cycle comes to its end would be nice.

Each day has brought positions a little but closer to the possibility of some rollovers.

That too would be nice as many of those had calls sold on them a few months ago, also selling those calls into some market strength in a hope that time would bring some price recovery.

That recovery, though, has been slow.

Even as the market has challenged reaching and surpassing its August high levels, the reality remains that market strength continues to be concentrated in a relatively small number of names and the number of stocks that have been and continue to be in correction or bear mode is staggering.

That may be the real theme of 2015, although when it’s all written most focus will probably go toward the fact that 2015 was the year in which interest rates were finally raised.

That will omit the real nature of this year that still sits right near the flat line, but only thanks to those small number of positions in the DJIA and S&P 500  that have performed very well.

Hopefully today and tomorrow will continue to bring us closer to making some income generating trades as we head into a Christmas shortened trading week.

Daily Market Update – December 16,  2015  (7:30 AM)

Yesterday was an unexpectedly strong day coming on the heels of a late day turnaround on Monday.

It’s hard to understand why that turnaround happened as it seemed as if the market’s embrace of an interest rate hike decision was already celebrated and that moment had come and gone.

It came on strongly as the Employment Situation Report was released and it disappeared very suddenly and with some gusto during most of last week’s trading, with a particular crescendo to end the week.

Nothing happened over the weekend to change the landscape, yet after a day of big alternating moves, it now seems as if the trajectory is upward again.

While that serves to reduce volatility, which had been on a decent rise over the previous week, the timing of any rally is good, as it comes at the end of a monthly option cycle.

With a number of previous “Hail Mary” kind of option sales that were made a month or longer ago about to expire, I would love to be able to roll those over while still waiting for their inevitable attempt to reclaim some former glory.

This morning’s futures were again up strongly as everyone awaited the FOMC’s decision at 2 PM.

While we all expected that interest rate hike that was finally announced there was still a pronounced reaction, but we’ve also seen those come and go and often in very quick fashion.

Today it was more restrained until some time after the announcement.

What was more interesting to traders, and it has often been the case, were the words coming from Federal Reserve Chairman Janet Yellen during both her prepared text and her press conference.

What everyone wanted to know is whether she sees any interest rate hike as a “one and done” or whether she sees signs that the economy is really heating up and that further hikes in 2016 are going to be a likelihood.

You would think that if the market is embracing this likely interest rate hike they would be disappointed if Chairman Yellen suggested that this may be a “one and done,” without necessarily using those words.

The idea that the economy isn’t growing so much as to consider further increases in the coming year could be enough to remove the wind from a developing rally.

Still, traders were putting their money on the likelihood that the economy is going to warrant some further FOMC tightening and their expectation than has to be that corporate revenues will be increasing and earnings will be, as well.

Depending on how far into the future the FOMC’s crystal ball goes, that could mean an expectation of some evidence of improved earnings metrics as early as the January 2016 round of earnings, or perhaps the next quarter at the latest.

Anything beyond that would be pretty disappointing and would have people questioning the wisdom of what is likely to be an interest rate hike announcement today.

Like most people, I was watching for the news and the reaction.

Once the hike was announced and the press conference was over, the predominant belief was that we were going to be in store for another rate hike in early 2016 and yet the market didn’t panic.

That’s good.

Let’s see if it can last like that through the rest of the week.

I hope that the optimism continues at least until this week comes to its end.

The market could use a year end rally to let it finally break into positive territory and maybe stay that way to end the year, but unless that rally is going to really be of fairly epic proportions, the year may end up about as flat as 2011 when the S&P 500 was unchanged for the entire year.

Daily Market Update – December 16,  2015  (7:30 AM)

Yesterday was an unexpectedly strong day coming on the heels of a late day turnaround on Monday.

It’s hard to understand why that turnaround happened as it seemed as if the market’s embrace of an interest rate hike decision was already celebrated and that moment had come and gone.

It came on strongly as the Employment Situation Report was released and it disappeared very suddenly and with some gusto during most of last week’s trading, with a particular crescendo to end the week.

Nothing happened over the weekend to change the landscape, yet after a day of big alternating moves, it now seems as if the trajectory is upward again.

While that serves to reduce volatility, which had been on a decent rise over the previous week, the timing of any rally is good, as it comes at the end of a monthly option cycle.

With a number of previous “Hail Mary” kind of option sales that were made a month or longer ago about to expire, I would love to be able to roll those over while still waiting for their inevitable attempt to reclaim some former glory.

This morning’s futures are again up strongly as everyone awaits the FOMC’s decision at 2 PM.

While we all expect that interest rate hike, there’s still likely to be some kind of pronounced reaction, but we’ve also seen those come and go and often in very quick fashion.

What may be more interesting to traders, and it has often been the case, will be the words coming from Federal Reserve Chairman Janet Yellen during both her prepared text and her press conference.

What everyone will want to know is whether she sees any interest rate hike as a “one and done” or whether she sees signs that the economy is really heating up and that further hikes in 2016 are going to be a likelihood.

You would think that if the market is embracing this likely interest rate hike they would be disappointed if Chairman Yellen suggested that this may be a “one and done,” without necessarily using those words.

The idea that the economy isn’t growing so much as to consider further increases in the coming year could be enough to remove the wind from a developing rally.

Still, traders are putting their money on the likelihood that the economy is going to warrant some further FOMC tightening and their expectation than has to be that corporate revenues will be increasing and earnings will be, as well.

Depending on how far into the future the FOMC’s crystal ball goes, that could mean an expectation of some evidence of improved earnings metrics as early as the January 2016 round of earnings, or perhaps the next quarter at the latest.

Anything beyond that would be pretty disappointing and would have people questioning the wisdom of what is likely to be an interest rate hike announcement today.

Like most people, I’ll be watching for the news and the reaction.

I hope that the optimism continues at least until this week comes to its end.

The market could use a year end rally to let it finally break into positive territory and maybe stay that way to end the year, but unless that rally is going to really be of fairly epic proportions, the year may end up about as flat as 2011 when the S&P 500 was unchanged for the entire year.

Daily Market Update – December 15,  2015  (Close)

Yesterday was a very interesting day.

It was really a roller coaster all day, but unlike most rollercoasters, which end on the downslide, yesterday’s market ended on the upside.

Yesterday the futures started strongly but lost strength heading into the open.

Then the market opened to a rally, lost steam, rallied, lost steam and then finally re-discovered itself in the final 30 minutes of trading to close more than 100 points higher.

Not bad.

Confusing, but not bad, as it was another day with no real news.

This morning’s futures opened strongly and actually built strength as the pre-open session wore on. Although the market ended up closing about 100 points below its high for the day, being up 156 points isn’t too shabby.

All of this happens as the FOMC begins its 2 day meeting today and woe is to the market if it ends up not raising interest rates.

Especially since all experts are now of the belief that the rally is an embrace of finally getting this “will they or won’t they raise rates” ordeal over with.

Everyone is expecting that rate rise to come tomorrow and in the very small chance that it doesn’t, it will only send a message that the economy isn’t even strong enough to bear the burden of a 0.25% rate increase.

On the other hand, if the FOMC surprises in the other direction and actually raises rates by a very unexpectedly high 0.5%, which used to be the norm, the market would probably have the equivalent of a stroke.

The fact that it was rallying this morning coming off yesterday’s late rise and it was more or less able to keep that momentum going throughout the day today should mean that people are again ready to embrace the idea that an interest rate hike reflects a good economy.

The behavior of traders, though, from the time of the Employment Situation Report until last Friday is fairly odd, as you might have expected that if there was going to be a sell-off it would have come around the time of the actual news becoming reality.

Instead, it seems as everyone wanted to get a jump on everyone else and sell before the news became news.

That itself may be the makings of a new norm as increasingly we’re even seeing reactions to technical levels before the levels are being hit, as everyone is looking for an advantage over the next guy.

That’s as old as mankind itself, but after a while if that continues, you probably have to start re-writing the rules of trader behavior and add institutional reverse psychology into the mix.

With one purchase yesterday I wouldn’t mind some continuing strength for the week, including strength coming as a result of the FOMC’s decision. I’d love to have the opportunity to get some assignments or to even have an outside chance at some rollovers.

That wasn’t looking very promising yesterday, but now isn’t necessarily totally out of the question, particularly if some longer term option expirations are considered, as was the case with some of those set to expire this week.

There were a number of those that I put feelers out for today, but none of those trades got made.

Maybe tomorrow.

I had been expecting to be mostly watching today, but I would take any opportunity to capitalize on continued strength if it can maintain itself.

The lesson learned from last week was to definitely take advantage  of that strength because it can’t necessarily be guaranteed to maintain itself.

Daily Market Update – December 15,  2015  (8:00 AM)

Yesterday was a very interesting day.

It was really a roller coaster all day, but unlike most rollercoasters, which end on the downslide, yesterday’s market ended on the upside.

Yesterday the futures started strongly but lost strength heading into the open.

Then the market opened to a rally, lost steam, rallied, lost steam and then finally re-discovered itself in the final 30 minutes of trading to close more than 100 points higher.

Not bad.

Confusing, but not bad, as it was another day with no real news.

This morning’s futures opened strongly and actually built strength as the pre-open session wore on.

All of this happens as the FOMC begins its 2 day meeting today and woe is to the market if it ends up not raising interest rates.

Everyone is expecting that rate rise to come tomorrow and in the very small chance that it doesn’t, it will only send a message that the economy isn’t even strong enough to bear the burden of a 0.25% rate increase.

On the other hand, if the FOMC surprises in the other direction and actually raises rates by a very unexpectedly high 0.5%, which used to be the norm, the market would probably have the equivalent of a stroke.

The fact that it’s rallying this morning coming off yesterday’s late rise should mean that people are again ready to embrace the idea that an interest rate hike reflects a good economy.

The behavior of traders, though, from the time of the Employment Situation Report until last Friday is fairly odd, as you might have expected that if there was going to be a sell-off it would have come around the time of the actual news becoming reality.

Instead, it seems as everyone wanted to get a jump on everyone else and sell before the news became news.

That itself may be the makings of a new norm as increasingly we’re even seeing reactions to technical levels before the levels are being hit, as everyone is looking for an advantage over the next guy.

That’s as old as mankind itself, but after a while if that continues, you probably have to start re-writing the rules of trader behavior and add institutional reverse psychology into the mix.

With one purchase yesterday I wouldn’t mind some continuing strength for the week, including strength coming as a result of the FOMC’s decision. I’d love to have the opportunity to get some assignments or to even have an outside chance at some rollovers.

That wasn’t looking very promising yesterday, but now isn’t necessarily totally out of the question, particularly if some longer term option expirations are considered, as was the case with some of those set to expire this week.

I expect to be mostly watching today, but would take any opportunity to capitalize on continued strength if it can maintain itself.

The lesson learned from last week was to definitely take advantage  of that strength because it can necessarily be guaranteed to maintain itself.

Daily Market Update – December 14,  2015  (Close)

If you woke up on the early side this morning then you probably had a little sigh of relief and said “finally.”

If you then went to get yourself a cup of coffee and maybe engaged in a conversation or read the newspaper, you would have found that by the time you returned to your screen that the triple digit gain had become a loss, as the futures still had about another hour to go before the market opened for real.

Last week’s 3.8% loss left the market’s fairly deep in the hole for the year, with just 3 weeks to go to dig out of that hole.

For those who point to the fact that flat years are followed by strong years, with 3 weeks still left to go this year could still be something quite a distance from ending up flat.

With this week perhaps having an historic FOMC Statement release, one in which everyone is expecting an interest rate increase for the first time in nearly a decade, it’s very possible that the market’s reaction could be equally historic.

It has been so hard to figure out how the market will embrace rate increases once it demonstrated that it had the ability to accept an increase for what it actually represented.

The ability to view such increases as a good thing, when it has occurred, has been a very brief phenomenon.

For a day it looked as if the recent Employee SItuation Report was going to herald in a period of buying, at least until the FOMC Statement was actually released.

That would have been consistent with the age old phenomenon of “buy on the rumor and sell on the news.”

But the buying lasted only a single day and that led to last week.

We all know about last week.

I feel lucky to have been able to rollover all call positions and to have seen the short put position expire.

That at least generated some cash for the week and replenished the cash reserve just a little, respectively.

There was also another week with an unusually large number of ex-dividend positions for the week, so despite the large decline, I still felt pretty fortunate.

This week there aren’t nearly as many ex-dividend positions and the positions that are set to expire don’t have the same likelihood of being rolled over.

That leaves new position creation as the most likely means of generating income for the week, but this morning’s erosion in the futures, after last week’s debacle, doesn’t leave me very excited about spending down the all too small cash pile.

With no new purchases last wee, I would love to find a reason to break that 1 week pattern, but there has to be some sign that there is something good ahead.

While it’s possible that something good may come this week, perhaps during Janet Yellen’s press conference, we may have to wait until after the holidays.

Maybe at that time we’ll get some good news about consumer shopping, as retailers will begin reporting their sales data.

Otherwise, it may mean waiting for the next round of earnings releases in January, before we get any good news.

Having believed that each of the past two quarters would bring that good news, I’m reluctant to hold my breath this time around.

My expectation was that this week I wouldn’t be parting with too much money and would have been very happy to have any opportunity to rollover existing positions and would be ecstatic if I could actually even have an opportunity to find cover for positions just sitting there and adding nothing to income flow.

Funny thing, though.

It didn’t take too long to add some shares, but then I just sat for the rest of the day and watched things go up and then down and then up again, only to look like it was going to end the day pretty flat, until a final buying push in the final 30 minutes of the day.

Just as with last week, when there was a bit of luck involved, I may take the rest of the week to look for any opportunity to rollover those expiring positions if any opportunity presents itself during the week, even if fairly early in the week.

Having taken that opportunity last Thursday when the market showed some early day strength made all of the difference, as that strength then faded and led to the next day’s 300 point loss.

Waiting until the usual Friday for rollovers would have meant that none of the trades could have been made.

This week, there may be reason to look for any chance to make those trades prior to the FOMC Statement release and then just crossing fingers.

As it turned out, maybe crossing those fingers helped today, but there’s still a lot of potential stress to come this week.

Daily Market Update – December 14,  2015  (8:30 AM)

If you woke up on the early side this morning then you probably had a little sigh of relief and said “finally.”

If you then went to get yourself a cup of coffee and maybe engaged in a conversation or read the newspaper, you would have found that by the time you returned to your screen that the triple digit gain had become a loss, as the futures still had about another hour to go before the market opened for real.

Last week’s 3.8% loss left the market’s fairly deep in the hole for the year, with just 3 weeks to go to dig out of that hole.

For those who point to the fact that flat years are followed by strong years, with 3 weeks still left to go this year could still be something quite a distance from ending up flat.

With this week perhaps having an historic FOMC Statement release, one in which everyone is expecting an interest rate increase for the first time in nearly a decade, it’s very possible that the market’s reaction could be equally historic.

It has been so hard to figure out how the market will embrace rate increases once it demonstrated that it had the ability to accept an increase for what it actually represented.

The ability to view such increases as a good thing, when it has occurred, has been a very brief phenomenon.

For a day it looked as if the recent Employee SItuation Report was going to herald in a period of buying, at least until the FOMC Statement was actually released.

That would have been consistent with the age old phenomenon of “buy on the rumor and sell on the news.”

But the buying lasted only a single day and that led to last week.

We all know about last week.

I feel lucky to have been able to rollover all call positions and to have seen the short put position expire.

That at least generated some cash for the week and replenished the cash reserve just a little, respectively.

There was also another week with an unusually large number of ex-dividend positions for the week, so despite the large decline, I still felt pretty fortunate.

This week there aren’t nearly as many ex-dividend positions and the positions that are set to expire don’t have the same likelihood of being rolled over.

That leaves new position creation as the most likely means of generating income for the week, but this morning’s erosion in the futures, after last week’s debacle, doesn’t leave me very excited about spending down the all too small cash pile.

With no new purchases last wee, I would love to find a reason to break that 1 week pattern, but there has to be some sign that there is something good ahead.

While it’s possible that something good may come this week, perhaps during Janet Yellen’s press conference, we may have to wait until after the holidays.

Maybe at that time we’ll get some good news about consumer shopping, as retailers will begin reporting their sales data.

Otherwise, it may mean waiting for the next round of earnings releases in January, before we get any good news.

Having believed that each of the past two quarters would bring that good news, I’m reluctant to hold my breath this time around.

My expectation is that this week I won’t be parting with too much money and would be very happy to have any opportunity to rollover existing positions and would be ecstatic if I could actually even have an opportunity to find cover for positions just sitting there and adding nothing to income flow.

Just as with last week, when there was a bit of luck involved, I may take any opportunity to rollover those positions if it presents itself during the week, even if fairly early in the week.

Having taken that opportunity last Thursday when the market showed some early day strength made all of the difference, as that strength then faded and led to the next day’s 300 point loss.

Waiting until the usual Friday for rollovers would have meant that none of the trades could have been made.

This week, there may be reason to look for any chance to make those trades prior to the FOMC STatement release and then just crossing fingers.

Daily Market Update – December 11,  2015  (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:  STX (puts)

The following were ex-dividend this week: BBY (12/8 $0.23), HPE (12/7 $0.06), HPQ (12/7 $0.12), KSS (12/7 $0.45), M (12/11 $0.36), NEM (12/11 $0.025)

The following will be ex-dividend next week:  LVS (12/18 $0.65)

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

Daily Market Update – December 10,  2015  (Close)

For anyone who thought that last Friday’s nearly 400 point gain was going to herald in a new age, one that was able to transcend the first interest rate hike in nearly 10 years, the first 3 days of this week begged to differ.

All three of the previous trading days of this week had something to disappoint.

It wasn’t just that the market went lower, but it was also in how it had done so.

All 3 days had failed attempts to rally, but maybe yesterday’s action was the most disappointing. 

The fuel that should have come from the announcement of a merger between DuPont and Dow Chemical, one of which is a DJIA component and the other of which could easily also have qualified, did little to give markets a reason to sustain a reverse course.

The early rise of the market yesterday was quickly reversed and in a big way.

Also, the large differential in performance between the DJIA and the S&P 500 indicated that the gains weren’t very broadly spread. The DJIA would have been down about 50 points had it not been for DuPont’s performance.

This morning, the early futures trading was higher, but those numbers had been deteriorating as the opening bell was approaching.

With no new positions opened this week, it wasn’t too likely that any would be forthcoming in the final 2 day of the week.

Even with yesterday’s short term rally, there still hadn’t been a “Welcome” sign hanging out in front of the market and I haven’t seen any good reason to wander in more deeply. Today’s rally was nice, but it, too, finished well off of its highs and makes me wonder what’s next.

With all of this week’s dividends I’d have been content to let that serve as the week’s income flow, although I really very much wanted to see something good happen with the expiring positions this week.

While they haven’t fared as poorly as the rest of the market this week, and while I would have preferred to have seen them all get assigned, at this point I was of a mind to take whatever I could get in that regard.

With the rally seen in the earlier part of the day, I decided not to take any chances with a give back tomorrow and rolled over 3 of the four positions a little earlier than I would ordinarily have done. As the afternoon progressed that seemed to be a good idea, but we’ll see tomorrow.

I’d have like to see those assignments, but getting some rollovers instead, still left me happy, as we get ready to enter the final week of the December 2016 option cycle and we get ready for the market’s reaction to next week’s FOMC decision and the press conference that will follow.

Daily Market Update – December 10,  2015  (7:30 AM)

For anyone who thought that last Friday’s nearly 400 point gain was going to herald in a new age, one that was able to transcend the first interest rate hike in nearly 10 years, the first 3 days of this week begged to differ.

All three of the previous trading days of this week had something to disappoint.

It wasn’t just that the market went lower, but it was also in how it had done so.

All 3 days had failed attempts to rally, but maybe yesterday’s action was the most disappointing.

The fuel that should have come from the announcement of a merger between DuPont and Dow Chemical, one of which is a DJIA component and the other of which could easily also have qualified, did little to give markets a reason to sustain a reverse course.

The early rise of the market yesterday was quickly reversed and in a big way.

Also, the large differential in performance between the DJIA and the S&P 500 indicated that the gains weren’t very broadly spread. The DJIA would have been down about 50 points had it not been for DuPont’s performance.

This morning, the early futures trading is higher, but those numbers have been deteriorating as the opening bell is approaching.

With no new positions opened this week, it’s not too likely that any will be forthcoming in the next 2 days.

Even with yesterdays short term rally, there hasn’t been a “Welcome” sign hanging out in front of the market and I haven’t seen any good reason to wander in more deeply.

With all of this week’s dividends I’m content to let that serve as the week’s income flow, although I’d very much like to see something good happen with the expiring positions this week.

While they haven’t fared as poorly as the rest of the market this week, and while I would have preferred to have seen them all get assigned, at this point I’ll take whatever I can get in that regard.

I’d like to see those assignments, but if I can get some rollovers instead, I think I’d still be happy, as we get ready to enter the final week of the December 2016 option cycle and we get ready for the market’s reaction to next week’s FOMC decision and the press conference that will follow.

Daily Market Update – December 9,  2015  (Close)

Yesterday was the second consecutive day of unexpected large losses. Today was really the third, if you eliminated DuPont from the DJIA.

Both of those days had attempts to rally and both sputtered out, with neither of those days really being foretold by nervousness in futures trading.

This morning’s futures were just mildly lower, but they didn’t seem to be getting much in the way of encouragement from some potentially big merger news of two industrial and chemical giants.

Those two companies, Dow Chemical and DuPont were each soaring in the pre-opening, but the contagion wasn’t spreading very much, at least not in the early trading.

However, within about an hour after the opening bell the market was up nearly 200 points and then fell to its low, which was nearly 320 points off from the high.

When it all ended, the DJIA was only about 80 points lower, but take away DuPont and that performance would have been about 135 points lower..

The day may have deteriorated because cynics may have looked at the proposed merger as being one of desperation as commodity prices are continuing to suffer far longer than anyone would have imagined. Other cynics might have pointed to the activists at the doors of both companies.

Whatever the reason for the merger, it’s not an idea that hasn’t been entertained before, but for now, no one really seems to see it as anything but a couple of companies and not indicative of a bigger picture.

The bigger picture usually gets people speculating about merger mania and other opportunities. In a way, the lack of early speculation as to where this kind of merger could lead markets is a good thing, as most of the speculation that arises turns out to be baseless.

Right now, we don’t need any speculation, especially the baseless kind.

Following Monday’s decline, I still didn’t have a very good feeling about the next stop. That’s counter to about the last 10 weeks, especially when the week opened on a down or flat note.

During that time period I was a fairly active buyer on early week weakness, but this time it just felt a little bit different to me.

Yesterday was the same. Today, just more of the same.

Another big drop in markets, but still no real conviction that it was a good time to step in and pick up some bargains.

The issue, at least in my mind at the moment, is that i can’t identify any kind of catalyst that might lift markets until earnings start all over again in January 2016.

I still might be willing to look at some short term opportunities in the event that the market shows some stability, but I’m not overly excited about the prospects of taking on additional risk right now.

With next week’s FOMC meeting and most everyone expecting a decision to raise rates, it feels as if the response to that has already been built into markets, so I wouldn’t be too surprised if some more wind was let out of its sails.

If that’s the case, I don’t want to add any more weight to the portfolio.

This may be the kind of quiet week that hasn’t been seen in a few months, but I’m still hopeful that the positions with expirations this week will still remain in contention either for assignment or rollover.

So far, they’ve held up better than the overall market, but each day has been a new challenge lately.