Daily Market Update – July 20, 2015 (8:45 AM)
There is almost nothing happening this week on the economic calendar.
There’s also not too much expected on the international front as for now Greece and China seem to be quiet and Europe is getting ready for its month off. While Greece may be off the map for a while to come, it’s still anyone’s guess as to when we get back to realizing what a potential calamity may be forming in China.
But until any further indication that will be the case, it’s as if China doesn’t exist, at least in regard to presenting a level of liability that we’d prefer not to have to face.
What we do have this week is an avalanche of earnings and by all indications from last week, they are going to be better than expected.
The flow of positive information comes at a time that the market is just a fraction of a percent away from its all time highs and depending upon yoour persepctive is within easy reach of a technical resistance point or technical support point.
Depending upon how you look at it, that point is a launching pad for a climb higher or a jump off point to go lower.
But when you combine it with what may be a torrent of continuing good news there may be reason to think that it will end up being a launching pad more than anything else.
Considering that we’ve just bounced back from another one of those mini-corrections, although it was overdue, there’s not too much evidence over the past 3 years that we would turn around and head right back into another such correction without a substantive move higher and to new highs, first.
So far, as some more good earnings are released this morning, the market looks as if it will be getting the week off to a quiet start. Considering the kinds of gains that were made last week, simply staying in place isn’t necessarily a bad thing as trying to create some solid and firm ground underneath that rapid ascent tends to be a better way to reach new highs.
With a little bit of cash from not having spent any last week and with no positions set to expire this week as the August 2015 cycle begins, I’m anxious to do something to create some income for the week beyond the single ex-dividend position for the week.
Of course, the dilemma is not really wanting to spend that money in a chase of prices moving higher. The greater that everyone feels certain that the next move will be higher makes you get concerned that the crowd will be, as it usually is, wrong.
With the absence of overhanging or unresolved bad news and with earnings continuing to surprise to the upside, it is hard, though to see the near term reason for the market to not move to a higher point.
For that reason I am more likely to want to spend some money this week, but again will be looking at short term expirations in an effort to make some quick income and to hopefully be able to recycle cash from anticipated assignments.
While I usually would prefer to add those positions while the market shows some weakness, it’s possible that a mildly higher opening may represent relative weakness and that may be the best possible as market confidence has reason to be growing.