Daily Market Update – July 14, 2016 (Close)
This morning’s futures trading was suggesting that maybe a blowout could be in the cards.
It wasn’t really a blowout kind of day today, but the day’s gains just added more and more to the new closing record.
I would have liked more than a single day’s respite before continuing the climb higher, as would most technicians, although who’s going to say no to more gains, unless you’re just out and out short on stocks.
Although if you’re buying stocks now and there is a blowout in store, as long as you can recognize that those blowouts don’t usually end well for those climbing aboard, then the blowout can be a good thing.
As long as you jump off soon enough.
Even as the morning’s gains were pared by almost half heading into the opening bell, the DJIA futures were pointing another 100 points higher and by the close it did even better than that.
The decline in the increase came as the Bank of England didn’t lower interest rates, however, it did hint that it would introduce some more easing in August.
In the meantime, the preliminary numbers from JP Morgan were good, although there has not yet been the opportunity to hear their forecasts of a British-less European Union.
For my part, heading into the close of the option cycle, the gains are good.
With some gains today I wanted to look at any opportunity of selling calls on uncovered positions, particularly as earnings loomed, but was just happy to sit and watch.
I wouldn’t mind extending ownership of those positions through the use of longer term options to avoid any earnings risk and to perhaps get another dividend or two out of some of those positions.
In the meantime, there are still some more Federal Reserve Governors set to speak, although the market hasn’t been paying too much attention.
That may be a good thing and maybe would drive them back a bit into the shadows, but that’s not likely to happen once you’ve gotten a taste of the attention.