Category Archives: Daily Market Update

Daily Market Update – June 3, 2015  (Close)

With the ADP Employment Report coming this morning and setting the tone for what’s to be expected with Friday’s Employment Situation Report, the pre-open futures were again optimistic, as they were on Monday.

If that tone continued it would be the third day in an alternating pattern of direction, but there was some good news in both of the previous days this week, especially yesterday, as a meaningful early loss was reversed.

This morning, prior to the ADP release, the futures are already more than 100 points higher, probably in anticipation of a number that falls squarely and comfortably into the range of what most are expecting or hoping for.

Most neither want a number too good nor too weak.

Most would be very happy with economic data that is ambivalent. No one wants any suggestion of an economy heating up, nor as last week’s GDP data suggested, an economy that was shrinking faster than expected.

Whatever side you’re on, it all still comes down to what may be an irrational fear of the initiation of an interest rate increase.

History has shown that the market very quickly recovers from what never should have been a shock in the first place, as the early rounds of interest rate hikes are implemented. So it’s hard to understand why the markets have been so fixated on an action  that should be considered to reflect good economic news. Additionally, the early stages of interest rate hikes typically are followed by more economic growth and not a slowing down.

But old pre-conceived notions are hard to give up.

That ADP number turned out to be slightly less growth in the private sector job market than had been expected. The futures gave up just a little ground on that information, but essentially did nothing, as it came in as expected.

That tone continued today and will hopefully continue to do so for the next few days as we try to get out of this week with some combination of assignments and rollovers.

One of those rollover opportunities  came today and maybe some more are in store if the news remains good or even just ambivalent.

While there may not be too much trading in the personal account this week, it is at least much more busy than it was last week. Another positive is that this week has an unusual number of ex-dividend positions and that income is very much welcome after a week last the past one.

As I look at next week it too offers lots of ex-dividend positions and I don’t mind seeing those distributions add up.

For now, and probably for the rest of the week, there’s little likelihood that I’ll be adding more new positions. I would much rather see the number of existing positions get reduced and add more to my cash pile. As we continue to teeter at these levels and without any clear indication of what is coming next, my preference would be to have more cash than to have more risk.

But to get there, it will take some more moves higher and some more record closes, so I’m hopeful that Friday’s big event will be the kind of non-event that the market interprets in a bullish way.

While there’s not too much in the near term that should be able to act as a catalyst to move markets higher, with each passing day we get closer to the next earnings season that begins in just 5 weeks.

That is one that has had low expectations set for it as most were forecasting USD and Euro parity and that hasn’t been the case, so top line revenues and profits should be better than the guidance that so many companies had offered.

One possibility, however, that may not require having to wait 5 weeks for that catalyst, is if companies begin to change their guidance before earnings are released. That’s more commonly done when the news is bad, but sometimes it goes the other way, as well.

If that’s the case, hopefully we will be smart enough to realize that good news should be treated as good news.

Daily Market Update – June 3, 2015  (8:30 AM)

With the ADP Employment Report coming this morning and setting the tone for what’s to be expected with Friday’s Employment Situation Report, the pre-open futures are again optimistic, as they were on Monday.

If that tone continues it would be the third day in an alternating pattern of direction, but there was some good news in both of the previous days this week, especially yesterday, as a meaningful early loss was reversed.

This morning, prior to the ADP release, the futures are already more than 100 points higher, probably in anticipation of a number that falls squarely and comfortably into the range of what most are expecting or hoping for.

Most neither want a number too good nor too weak.

Most would be very happy with economic data that is ambivalent. No one wants any suggestion of an economy heating up, nor as last week’s GDP data suggested, an economy that was shrinking faster than expected.

Whatever side you’re on, it all still comes down to what may be an irrational fear of the initiation of an interest rate increase.

History has shown that the market very quickly recovers from what never should have been a shock in the first place, as the early rounds of interest rate hikes are implemented. So it’s hard to understand why the markets have been so fixated on an action  that should be considered to reflect good economic news. Additionally, the early stages of interest rate hikes typically are followed by more economic growth and not a slowing down.

But old pre-conceived notions are hard to give up.

That ADP number turned out to be slightly less growth in the private sector job market than had been expected. The futures gave up just a little ground on that information, but essentially did nothing, as it came in as expected.

Hopefully that tone will continue for the next few days as we try to get out of this week with some combination of assignments and rollovers.

While there may not be too much trading in the personal account this week, it is at least much more busy than it was last week. Another positive is that this week has an unusual number of ex-dividend positions and that income is very much welcome after a week last the past one.

For now, and probably for the rest of the week, there’s little likelihood that I’ll be adding more new positions. I would much rather see the number of existing positions get reduced and add more to my cash pile. As we continue to teeter at these levels and without any clear indication of what is coming next, my preference would be to have more cash than to have more risk.

But to get there, it will take some more moves higher and some more record closes, so I’m hopeful that Friday’s big event will be the kind of non-event that the market interprets in a bullish way.

While there’s not too much in the near term that should be able to act as a catalyst to move markets higher, with each passing day we get closer to the next earnings season that begins in just 5 weeks.

That is one that has had low expectations set for it as most were forecasting USD and Euro parity and that hasn’t been the case, so top line revenues and profits should be better than the guidance that so many companies had offered.

One possibility, however, that may not require having to wait 5 weeks for that catalyst, is if companies begin to change their guidance before earnings are released. That’s more commonly done when the news is bad, but sometimes it goes the other way, as well.

If that’s the case, hopefully we will be smart enough to realize that good news should be treated as good news.

Daily Market Update – June 2, 2015  (Close)

Last week was one that had absolutely no direction, although there wasn’t too much reason for it to have taken any direction from what few events were occurring.

If anything, the bias was to the downside, but that could be understood simply on the basis of the increasing weight of the market and with nothing obviously being recruited to help support that increasing weight.

This week has the same dearth of information and if this morning’s pre-open futures was going to be any indication of what may be ahead, there’s a reversal to yesterday’s very modest increase awaiting.

And that is exactly how the day played out, although the trading range for the day was a little wider than we’ve  recently seen.

Just like last week the singular big economic news item won’t occur until Friday morning. That leaves time for lots of speculation and ambivalence.

Friday’s Employment Situation Report is in a position to confound markets if it is too good or worse than expected, especially after last week’s disappointing GDP data.

Just like last month, what would probably suit the market the best and lead to a positive feeling, would be an employment picture that’s just right in line with expectations.

If that’s the case that delays even having to think about when the FOMC will begin to increase interest rates. That essentially puts June off the table and maybe gets people to bypass September, getting us closer and closer to 2016.

For more than a year, ever since Janet Yellen became Chairman of the Federal Reserve we’ve been delaying the realization that an increase in interest rates is likely to be a positive thing for everyone. What people still think about are those days of red hot inflation and interest rate changes that couldn’t keep up with inflation.

While that’s certainly bound to happen sometime in the future, where is the reason to believe that it’s in our future?

Like so many things in life, sometimes it’s just much better to get it over with and move on with life. If the past is any indication, when that day comes and the market panics over that first in a series of interest rate increases, it will just as quickly recover in the realization that the economy is finally doing what an economy is supposed to do. People with jobs and the ability to spend money is a good thing.

With 3 new positions opened yesterday, all counting on their dividends, I don’t think that there will be too much more to do this week as far as spending money goes.

After being in suspended animation last week, having even 3 trades seems like being on fire, but hopefully there’s more to be done during this week with existing positions.

The pre-opening futures weren’t giving too much confidence in that regard, but at least they are only very mildly lower, so anything was still possible as the day was set to unfold. I was actually surprised and happy to take advantage of some strength in Abercrombie and Fitch to do an early rollover, even though continued strength could have led to an assignment.

At this point I would rather lock in any of those premiums than let them get away, especially as it’s relatively cheap to buy back a deep in the money option these days if the price does really quickly accelerate.

Yesterday’s slow erosion of gains heading into the closing bell was disappointing, but it did put an end to 3 consecutive days of losses. The last of those days was based on the GDP report and could easily have had a lingering impact, but didn’t.

I look at that as a small positive in a sea of no positive news and all it ever takes is a spark.

Today’s recovery from an early triple digit loss and actually venturing suddenly into positive territory at noon time may have been another small positive.

As long as no one throws some cold water on things, the market is still within 1% of its recent all time high and could easily look to re-visit after a few days of resting while waiting for that spark.

Daily Market Update – June 2, 2015  (9:00 AM)

Last week was one that had absolutely no direction, although there wasn’t too much reason for it to have taken any direction from what few events were occurring.

If anything, the bias was to the downside, but that could be understood simply on the basis of the increasing weight of the market and with nothing obviously being recruited to help support that increasing weight.

This week has the same dearth of information and if this morning’s pre-open futures is going to be any indication of what may be ahead, there’s a reversal to yesterday’s very modest increase awaiting.

Just like last week the singular big economic news item won’t occur until Friday morning. That leaves time for lots of speculation and ambivalence.

Friday’s Employment Situation Report is in a position to confound markets if it is too good or worse than expected, especially after last week’s disappointing GDP data.

Just like last month, what would probably suit the market the best and lead to a positive feeling, would be an employment picture that’s just right in line with expectations.

If that’s the case that delays even having to think about when the FOMC will begin to increase interest rates. That essentially puts June off the table and maybe gets people to bypass September, getting us closer and closer to 2016.

For more than a year, ever since Janet Yellen became Chairman of the Federal Reserve we’ve been delaying the realization that an increase in interest rates is likely to be a positive thing for everyone. What people still think about are those days of red hot inflation and interest rate changes that couldn’t keep up with inflation.

While that’s certainly bound to happen sometime in the future, where is the reason to believe that it’s in our future?

Like so many things in life, sometimes it’s just much better to get it over with and move on with life. If the past is any indication, when that day comes and the market panics over that first in a series of interest rate increases, it will just as quickly recover in the realization that the economy is finally doing what an economy is supposed to do. People with jobs and the ability to spend money is a good thing.

With 3 new positions opened yesterday, all counting on their dividends, I don’t think that there will be too uch more to do this week as far as spending money goes.

After being in suspended animation last week, having even 3 trades seems like being on fire, but hopefully there’s more to be done during this week with existing positions.

The pre-opening futures aren’t giving too much confidence in that regard, but at least they are only very mildly lower, so anything is possible as the day unfolds.

Yesterday’s slow erosion of gains heading into the closing bell was disappointing, but it did put an end to 3 consecutive days of losses. The last of those days was based on the GDP report and could easily have had a lingering impact, but didn’t.

I look at that as a small positive in a sea of no positive news and all it ever takes is a spark.

As long as no one throws some cold water on things, the market is still within 1% of its recent all time high and could easily look to re-visit after a few days of resting while waiting for that spark.

Daily Market Update – June 1, 2015  (Close)

After a week of absolutely no direction and no theme, there’s not too much reason to believe that this week will be much different.

Other than on Friday, when the Employment Situation Report is released, there’s really not too much scheduled news and the market could find itself going back and forth as it did last week.

This week appeared to be getting ready to get off on the other foot, though, as the pre-open futures was pointing moderately higher. That follows a week where the bias was to the downside and then cemented there as the GDP Report was released on Friday.

This week’s Employment Situation Report could put the FOMC in an interesting position in the event that employment data is strong, as it was last month.

Somehow they would have to deal with conflicting pieces of economic information in deciding whether there is sufficient and valid enough data to make a decision to raise interest rates. With the GDP indicating that the economy was shrinking more than expected, but in the light of job growth, you would have to scratch your head in trying to understand how those would be occurring concurrently.

I’ll let them work that out while I think about other things.

Mostly, that will be the usual kind of things. The only difference is that after last week of no new trades and only a single position needing a rollover, it would really be nice to do something more meaningful this week.

While I would like to see the cash reserve pile grow even more, I would like to add some new positions this week to complement the 3 positions that are set to expire this week.

It was nice, at least for now, to have added some new positions, all three of which had dividends in the equation.  For now, I want dividends as an offset to risk.

While the early bias to start the week does look as if it will be higher, it’s still difficult to know what will be responsible for propelling markets higher. It’s also difficult to know just how the market will respond to news in general. Will they be disappointed by bad news, as was the case with last week’s GDP or would they be elated about bad news, as they would have responded about a month or so ago, to the very same news.

For the moment it appears as if the market is discounting a very small interest rate increase and is expressing disappointment with anything that might actually delay that increase. Last month the disappointment was if anything appeared to be accelerating that increase.

For its part, the bond market isn’t as effusive about rates going up sooner, rather than later, as it was just 2 weeks ago.

In essence, no one really has any clue as to what is next and how we will respond. But just to confuse things even more, the bond market returned to its belief that rates were heading higher and did so in a big way today.

This week, at least has a large number of ex-dividend positions to keep some income flowing in and in a small way maybe off-setting last week’s drought, but that represents passivity. Hopefully, there will be some good reason for actively pursuing some income and profits this week, without adding on too much risk in the process.

Daily Market Update – June 1, 2015  (8:30 AM)

After a week of absolutely no direction and no theme, there’s not too much reason to believe that this week will be much different.

The Week in Other than on Friday, when the Employment Situation Report is released, there’s really not too much scheduled news and the market could find itself going back and forth as it did last week.

This week appears to be getting ready to get off on the other foot, though, as the pre-open futures is pointing moderately higher. That follows a week where the bias was to the downside and then cemented there as the GDP Report was released on Friday.

This week’s Employment Situation Report could put the FOMC in an interesting position in the event that employment data is strong, as it was last month.

Somehow they would have to deal with conflicting pieces of economic information in deciding whether there is sufficient and valid enough data to make a decision to raise interest rates. With the GDP indicating that the economy was shrinking more than expected, but in the light of job growth, you would have to scratch your head in trying to understand how those would be occurring concurrently.

I’ll let them wotk that out while I think about other things.

Mostly, that will be the usual kind of things. The only difference is that after last week of no new trades and only a single position needing a rollover, it would really be nice to do something more meaningful this week.

While I would like to see the cash reserve pile grow even more, I would like to add some new positions this week to complement the 3 positions that are set to expire this week.

While the early bias to start the week does look as if it will be higher, it’s still difficult to know what will be responsible for propelling markets higher. It’s also difficult to know just how the market will respond to news in general. Will they be disappointed by bad news, as was the case with last week’s GDP or would they be elated about bad news, as they would have responded about a month or so ago, to the very same news.

For the moment it appears as if the market is discounting a very small interest rate increase and is expressing disappointment with anything that might actually delay that increase. Last month the disappointment was if anything appeared to be accelerating that increase.

For its part, the bond market isn’t as effusive about rates going up sooner, rather than later, as it was just 2 weeks ago.

In essence, no one really has any clue as to what is next and how we will respond.

This week, at least has a large number of ex-dividend positions to keep some income flowing in and in a small way maybe off-setting last week’s drought, but that represents passivity. Hopefully, there will be some good reason for actively pursuing some income and profits this week, without adding on too much risk in the process.

Daily Market Update – May 29, 2015  (8:00 AM)

The Week in Revew will be posted by 6 PM and the Weekend Update will be posted by noon on Sunday.

It was hard to understand what happened on Tuesday, just as it was hard to understand exactly what happened yesterday.

The following trade outcomes are possible today:

Assignments:  none

Rollovers:  none

Expirations:   none

The following were ex-dividend this week:  ANF (5/29 $0.20), RIG (5/27 $0.15)

The following will be ex-dividend next week:  HAL (6/1 $0.18), JOY (6/2 $0.20), MOS (6/2 $0.275), BAC (6/3 $0.05), COH (6/3 $0.34), HFC (6/3 $0.33)

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

Daily Market Update – May 28, 2015  (Close)

It was hard to understand what happened on Tuesday, just as it was hard to understand exactly what happened yesterday.

Yesterday’s market wasn’t exactly an equal and opposite reaction, but at least it was noticeable in the correction to the previous day.

It still, however, doesn’t leave us anywhere other than continuing to be on that big piece of plywood delicately balanced on the head of a nail.

The pre-open futures was again poised to offer virtually nothing in the form of direction as I was getting ready to scan positions this morning. Today looked as if it would be bringing me one more step closer to a week with no trades, other than the early assignment of one position.

But somehow that market vectors Gold Miners ETF got yet another rollover. That as its 20 trade overall in the past 6 months.

While I do like the additional cash, it has been a frustrating week. Although I wasn’t expecting to make many trades and already aware that there was little to be rolled over this holiday shortened week, the very few trades that I’ve tried to make haven’t materialized. Even the one rollover couldn’t get executed yesterday.

With now just one day left in this week my expectations are low, but it will be very interesting to see how tomorrow’s GDP figure will look, as well as how the markets will react to it.

Any suggestion that the economy is heating up, or is on a stronger path than had been earlier indicated, is likely to be met with a bad market reaction. Following Tuesday’s sell off, it may not take much to tip over that perfectly balanced sheet of plywood.

With this week being a virtual wasteland and no activity, my eyes are on next week and hoping to be able to do something with the cash on hand as well as something with the few positions already set to expire next Friday.

Hopefully the next couple of days will show some more consistency and allow some more strategic planning. The back and forth that we’ve seen over the past few weeks, while occasionally setting some new record highs, isn’t the kind that creates confidence, nor does it create a strong support level for the market to climb even higher.

Still, as unhealthy as it seems, you do have to admire the way the market has been able to stick in and respond to every challenge with a new effort to recover.

I’m willing to do that, but I’d be much more willing if I could be a much more active participant.

That doesn’t look to be the case today or maybe not even tomorrow, but there’s always next week. At least then we have an Employment Situation Report and some FOMC Governors speaking to liven things up a little and maybe even get the futures back into the game.

,

Daily Market Update – May 28, 2015  (8:00 AM)

It was hard to understand wat happened on Tuesday, just as it was hard to understand exactly what happened yesterday.

Yesterday’s market wasn’t exactly an equal and opposite reaction, but at least it was noticeable in the correction to the previous day.

It still, however, doesn’t leave us anywhere other than continuing to be on that big piece of plywood delicately balanced on the head of a nail.

The pre-open futures is again poised to offer virtually nothing in the form of direction as getting ready to scan positions this morning. Today brings me one more step closer to a week with no trades, other than the early assignment of one position.

While I do like the additional cash, it has been a frustrating week. Although I wasn’t expecting to make many trades and already aware that there was little to be rolled over this holiday shortened week, the very few trades that I’ve tried to make haven’t materialized. Even the one rollover couldn’t get executed yesterday.

With just two days left in this week my expectations are low, but it will be very interesting to see how tomorrow’s GDP figure will look, as well as how the markets will react to it.

Any suggestion that the economy is heating up, or is on a stronger path than had been earlier indicated, is likely to be met with a bad market reaction. Following Tuesday’s sell off, it may not take much to tip over that perfectly balanced sheet of plywood.

With this week being a virtual wasteland and no activity, my eyes are on next week and hoping to be able to do something with the cash on hand as well as something with the few positions already set to expire next Friday.

Hopefully the next couple of days will show some more consistency and allow some more strategic planning. The back and forth that we’ve seen over the past few weeks, while occasionally setting some new record highs, isn’t the kind that creates confidence, nor does it create a strong support level for the market to climb even higher.

Still, as unhealthy as it seems, you do have to admire the way the market has been able to stick in and respond to every challenge with a new effort to recover.

I’m willing to do that, but I’d be much more willing if I could be a much more active participant.

That doesn’t look to be the case today or maybe not even tomorrow, but there’s always next week. At least then we have an Employment Situation Report and some FOMC Governors speaking to liven things up a little and maybe even get the futures back into the game.

,

Daily Market Update – May 27, 2015  (Close)

It’s still hard to understand what exactly happened yesterday.

Sometimes on the first day back after a holiday weekend of the kind that’s not celebrated elsewhere in the world, our markets can have a gap up or gap down if there was some kind of large move in European or Asian markets.

But that wasn’t the case. It was a quiet 3 days all over the world and our own futures market was predicting more of the same.

With most major companies having already reported earnings, the price of oil stabilizing and the US Dollar getting a little less precious in foreign exchanges there really wasn’t much threatening in the air, other than the fact that we were right near all time highs and haven’t had a real correction in 3 years.

Maybe that’s enough.

Within minutes of the opening bell the market began telling a very different story from what the futures had portended. While those muted futures performances don’t necessarily have great predictive value, it is unusual to see the market diverge so strongly and so quickly from the futures.

The real emphasis on that last line goes on just how quickly the market turned negative and turned its back on the futures.

With most of my new position trades typically occurring on Mondays and Tuesdays and most rollovers usually on Thursdays and Fridays, this really has the makings for being a very unusual week.

While there have been two or three weeks over the past 3 years that have not had any new positions opened, there has never been a week without either a new position being opened or some position being rolled over.

This could be that week.

The only positive thing about yesterday was that volatility, which has been plummeting lately, at least got a little bit of a boost. Even so, it still has a long way to go to make things interesting again.

This morning’s futures were again looking as if it would be a quiet day, this time with a little bias to the upside.

Today simply proved to be another example of how those futures, especially when they’re muted in their expression, are pretty meaningless.

All they show is that the professional money, the kind that’s supposed to be smarter than the other kind of money, doesn’t really know what it’s doing on certain days.

For me, the relative calm before the market opened didn’t feel very inviting. As with previous weeks I would still like to see the cash reserve pile being bigger than it is at the moment, especially if there are some more days like yesterday ahead.

With the early assignment of Lexmark this morning to capture its dividend, I do feel a little better about having some more cash available, though, especially since it meant keeping the entire month’s option premium and still having another 3 weeks to put that money to work. But even then, I’d like to see some more cash in that pile.

Unless there’s an unexpected purchase opportunity with an expiration for this week, that’s not too likely, so without much to focus on for this week, as there’s only one position possibly up for assignment or rollover, the focus shifts to next week. Even with that in mind, I kept looking for anything that could be justified, but had a hard time talking myself into any trades.

At least there are already some positions set to expire next week and maybe between now and then there may be a little more clarity ahead and some more clear signal as to whether it makes sense to dip into cash.

Not to mix metaphors too much, but while that cash does burn a hole in my pocket, I’d rather feel that heat than see it go down the drain.

Daily Market Update – May 27, 2015  (8:00 AM)

It’s still hard to understand what exactly happened yesterday.

Sometimes on the first day back after a holiday weekend of the kind that’s not celebrated elsewhere in the world, our markets can have a gap up or gap down if there was some kind of large move in European or Asian markets.

But that wasn’t the case. It was a quiet 3 days all over the world and our own futures market was predicting more of the same.

With most major companies having already reported earnings, the price of oil stabilizing and the US Dollar getting a little less precious in foreign exchanges there really wasn’t much threatening in the air, other than the fact that we were right near all time highs and haven’t had a real correction in 3 years.

Maybe that’s enough.

Within minutes of the opening bell the market began telling a very different story from what the futures had portended. While those muted futures performances don’t necessarily have great predictive value, it is unusual to see the market diverge so strongly and so quickly from the futures.

The real emphasis on that last line goes on just how quickly the market turned negative and turned its back on the futures.

With most of my new position trades typically occurring on Mondays and Tuesdays and most rollovers usually on Thursdays and Fridays, this really has the makings for being a very unusual week.

While there have been two or three weeks over the past 3 years that have not had any new positions opened, there has never been a week without either a new position being opened or some position being rolled over.

This could be that week.

The only positive thing about yesterday was that volatility, which has been plummeting lately, at least got a little bit of a boost. Even so, it still has a long way to go to make things interesting again.

This morning’s futures were again looking as if it would be a quiet day, this time with a little bias to the upside, but the relative calm doesn’t feel very inviting. As with previous weeks I would still like to see the cash reserve pile being bigger than it is at the moment, especially if there are some more days like yesterday ahead.

With the early assignment of Lexmark this morning to capture its dividend, I do feel a little better about having some more cash available, though, especially since it meant keeping the entire month’s option premium and still having another 3 weeks to put that money to work. But even then, I’d like to see some more cash in that pile.

Unless there’s an unexpected purchase opportunity with an expiration for this week, that’s not too likely, so without much to focus on for this week, as there’s only one position possibly up for assignment or rollover, the focus shifts to next week.

AT least there are already some positions set to expire next week and maybe between now and then there may be a little more clarity ahead and some more clear signal as to whether it makes sense to dip into cash.

Not to mix metaphors too much, but while that cash does burn a hole in my pocket, I’d rather feel that heat than see it go down the drain.

Daily Market Update – May 26, 2015  (Close)

Well, today was certainly a surprise.

Looking at the pre-open futures every indication was that this holiday shortened week was going to get off on the same foot that reflected all of last week.

If that was going to be the case it was destined to be another very listless trading session.

But it didn’t take long for things to deteriorate. Within about 10 minutes the market was already down 100 points and with no real reason to account neither for it nor for the additional 100 points that was tacked on.

The question, at some point, and maybe that point started this morning, was just how long the market can essentially do nothing as it sits right at all time highs. That’s basically like trying to balance an 8 foot length piece of plywood on the head of a pin. For a split second there may be an equilibrium, but you just know that it can’t last.

The only difference is that the plywood can only drop and the market doesn’t necessarily need a reason, such as the suspension of gravity and the laws of nature, to go higher.

There’s not too much economic news this week, although there are a few that can give the FOMC some reason to begin the interest rate hiking process.

This week there are Durable Goods, New Home Sales, Jobless Claims and perhaps, most importantly, Friday’s GDP.

This morning none of those were really on anyone’s mind. Maybe only the weight of the precarious piece of plywood was dangling over investor’s heads enough to stir some nerves.

With today finally out of the way, there is still some things to consider as the week progresses, most notably as it comes to its close.

With all of the controversy surrounding the accuracy of the previous winter months GDP reports, this Friday’s release may cause a re-set in thinking. That’s because the rate of change may now take on a very different character as the results of those winter months are more closely re-scrutinized.

The FOMC probably doesn’t care where the economy has been, but they do care about where it’s going and how fast it’s getting there. With what may have been faulty Q1 data, it’s really difficult to then assess the velocity or acceleration rate of change.

But that’s their problem and I’m sure that they’ll deal with it in a measured and rational way.

Not too many people are still thinking that a rate hike might be announced at the June meeting, but all it may take is a couple of corroborating reports to suggest that things are heating up after the winter and there could still easily be room for a small interest rate increase in the coming month.

That would cast a near term pall on markets, as the debate had shifted to whether the rate hike would be coming in September or maybe even waiting until 2016.

But that leaves the rest of us to wonder whether much of the foundation of the market’s recent strength, that is the expectation that higher interest rates weren’t coming too soon, may prove to have been a misguided expectation.

As the market does started the morning right below all time closing highs and with cash still lower than I would like, I’m probably not going on a spending spree this week. However, if I’m going to meet the weekly goal of generating an income stream, that’s going to require some new purchases.

I’m not a big fan of having competing interests in life, but this is one of those time when the desire to conserve cash is in conflict with the need to generate cash.

That’s because what I mentioned a few weeks ago as a possibility has become the reality. As I mentioned a few weeks ago this Friday’s expiration could have ended up being one with no expiring positions and that’s almost the case, with only the Market Vectors Gold Miners ETF set to expire this week.

With virtually no positions to rollover there are no income producing positions unless new ones are added.

With only 4 days of time reflected in this week’s option premiums there may be reason to look at extended weekly expirations for any new positions that may be opened and simply adding to the small handful that are already set to expire next week.

Daily Market Update – May 26, 2015  (8:45 AM)

Looking at the pre-open futures every indication is that this holiday shortened week is going to get off on the same foot that reflected all of last week.

If that’s going to be the case it’s going to be another very listless trading session.

The question, at some point, becomes just how long the market can essentially do nothing as it sits right at all time highs. That’s basically like trying to balance an 8 foot length piece of plywood on the head of a pin. For a split second there may be an equilibrium, but you just know that it can’t last.

The only difference is that the plywood can only drop and the market doesn’t necessarily need a reason, such as the suspension of gravity and the laws of nature, to go higher.

There’s not too much economic news this week, although there are a few that can give the FOMC some reason to begin the interest rate hiking process.

This week there are Durable Goods, New Home Sales, Jobless Claims and perhaps, most importantly, Friday’s GDP.

With all of the controversy surrounding the accuracy of the previous winter months GDP reports, this Friday’s release may cause a re-set in thinking. That’s because the rate of change may now take on a very different character as the results of those winter months are more closely re-scrutinized.

The FOMC probably doesn’t care where the economy has been, but they do care about where it’s going and how fast it’s getting there. With what may have been faulty Q1 data, it’s really difficult to then assess the velocity or acceleration rate of change.

But that’s their problem and I’m sure that they’ll deal with it in a measured and rational way.

Not too many people are still thinking that a rate hike might be announced at the June meeting, but all it may take is a couple of corroborating reports to suggest that things are heating up after the winter and there could still easily be room for a small interest rate increase in the coming month.

That would cast a near term pall on markets, as the debate had shifted to whether the rate hike would be coming in September or maybe even waiting until 2016.

But that leaves the rest of us to wonder whether much of the foundation of the market’s recent strength, that is the expectation that higher interest rates weren’t coming too soon, may prove to have been a misguided expectation.

As the market does sit right below all time closing highs and with cash still lower than I would like, I’m probably not going on a spending spree this week. However, if I’m going to meet the weekly goal of generating an income stream, that’s going to require some new purchases.

I’m not a big fan of having competing interests in life, but this is one of those time when the desire to conserve cash is in conflict with the need to generate cash.

That’s because what I mentioned a few weeks ago as a possibility has become the reality. As I mentioned a few weeks ago this Friday’s expiration could have ended up being one with no expiring positions and that’s almost the case, with only the Market Vectors Gold Miners ETF set to expire this week.

With virtually no positions to rollover there are no income producing positions unless new ones are added.

With only 4 days of time reflected in this week’s option premiums there may be reason to look at extended weekly expirations for any new positions that may be opened and simply adding to the small handful that are already set to expire next week.

Daily Market Update – May 22, 2015  (9:30 AM)

The Week in Review will be posted by 6 PM tonight and the Weekend Update will be posted by Noon on Monday.

The following trade outcomes are possible today:

Assignments:   none

Rollovers:  GDX, TWTR (puts)

Expirations:   KMI, UAL

The following were ex-dividend this week: MRO (5/17 $0.21), CVC (5/20 $0.15), MAT (5/20 $0.38)

The following are ex-dividend next week: LXK (5/27 $0.36), RIG (5/27 $0.15)

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

Daily Market Update – May 21, 2015  (Close)

The market seems to be reflecting the fact that the biggest story of the week is that it marked the final episode of the David Letterman era on late night television.

This morning is another in a series of quiet early morning starts in a week that doesn’t have very much news, although there may be some spillover as the concept of official government GDP numbers having been wrong begins to really sink in.

The quiet mornings of the past week have also been reflected in this week’s personal trading activity. The market hasn’t done too much to make tomorrow look as if it will be overly active one on a personal level, as the weakness has made those rollovers and assignments look less and less likely.

Yesterday’s release of the FOMC minutes gave the impression that interest rate hikes were not going to be likely in June, as the members of the FOMC repeatedly emphasized their dependence on data.

This week is likely to continue being a quiet one, unless some more news related to the quality of economic data comes in.

While the reading of those minutes gave stock market bulls some reason to believe that the rally could continue, the reality is that all of those words that were being said were all being said in the context of believing the data that was in front of them.

Any further insight into what the data really is, especially if it does indicate more substantial growth than the disappointing numbers we had been receiving, could easily get the FOMC to take an action that is completely counter to what they had been intending.

You certainly couldn’t blame them for that.

If so, that would certainly put the brakes on any continuing climb beyond 2120 on the S&P 500.

With next week being a holiday shortened week I’m still undecided as to what tactic to take. Much of that indecision is based upon not knowing whether the week’s final 2 days would bring any opportunity to create income or see cash reserves get replenished, as those prospects were seemingly less likely before Thursday’s session got underway.

I would have loved to have seen some nice, albeit totally unexpected advance today to be able to get those expiring positions into better condition for either rollovers or assignments, but it really didn’t require that kind of move to at least get some trades done today.

Although the early pre-open trading wasn’t giving any indication of that being the case, there was at least still some hope for some of the positions to be put into action before Friday’s final bell. Today offered some chance for rolling over a few positions taking some advantage of their price stability today and to close out the single new position opened this week.

That created some income and brought the cash reserves to where the week started. That makes it a little easier to deal with tomorrow’s market, regardless of what direction it takes.

If conventional wisdom holds, there’s not much reason to overly commit to the long side ahead of a long weekend, but at least the ability to secure today’s trades makes it less of a hostage situation.

Still, while not committing to long positions over a long weekend is the logical expectation, there hasn’t been too much of that over the past couple of years, as some of the best Friday’s have come either going into long weekends or weekends of great uncertainty.

So I’ll remain hopeful and watchful as the hours tick down to Friday’s closing bell.