Daily Market Update – February 12, 2015 (Close)




Daily Market Update – February 12, 2015 (Close)

This morning, based on the pre-opening futures, looked to have a similar opening to that seen on Tuesday.

The futures were pointing nicely higher, approaching a triple digit gain on the DJIA, and those kind of larger moves tend to have more staying power. At least they tend to give a little more direction to trading once the market actually opens.

That would have been a welcome move, particularly as the week was coming to its end and the fate of those positions set to expire this week are being determined during the final hours of trading for the week.

Luckily that is exactly the way the day worked out as the market was never trading at a loss for the day and actually closed near its highs for the day and ended up within easy distance of an all time high, not having done so since the end of December.

The news that seems to be responsible for the move actually started shortly after yesterday’s market closed and the S&P 500 futures went up about 12 points and the DJIA went nearly 100 points higher.

That news was that there was some kind of an agreement between the the ECB, EU and Greece over its debt.

That gain disappeared in the late afternoon and early evening yesterday, but then returned and seemed to be holding as the morning’s session was set to begin. It was, however, weakened a little by another weaker than expected “Retail Sales” report, that will hopefully be undone as the major retailers begin reporting earnings over the next two weeks and start focusing on the future, rather than the past, to look at the potential impact of lower energy prices, more people at work and more people receiving higher salaries.

With 5 positions set to expire this week and 8 the following week, I would much prefer seeing assignments this week rather than rolling over those positions. However, if rollovers are called for, or if there may be some other reason for a rollover, such as to capture Microsoft’s dividend, I would likely want to look at an expiration date sometime after next week.

The slightly elevated volatility makes that a little more palatable.

As it is  next week offers only 4 days of premium, due to the Presidents Day holiday and there are more than enough expiring positions than to add too many more and increase risk of a sudden market drop just before that expiration.

If tomorrow can add to today’s gain, it will hopefully position those expiring contracts to be more likely to be assigned and may even offer a miracle of selling some more new call contracts on existing positions, as was the case today.

Anyway, that’s my dream and I’m sticking to it for at least one more day.