Month: August 2016

Daily Market Update – August 2, 2016 (Close)

After 6 straight losing days we were still only about 8 points off the all time intra-day high on the S&P 500.

Now you can make that 7 straight losing days and 21 points from that all time intra-day high.

Up until this morning that would have been the kind of support that needed to be built to have a platform to move higher and to create a situation where there could be a stopping station if it decided again to go lower.

Futures were again pointing mildly lower this morning, but there was not too much reason to suspect that it would do anything other than continue to trade in a fairly narrow range.

At least until Friday when the Employment Situation report is released, or so it seemed.

With the most recent GDP data release it’s hard to understand how the employment situation could be improving, but there hasn’t been too much of a correlation between the two for quite some time.

Even as wages increase and the unemployment rate falls, the expectation that a consumer led increase in the GDP would occur just hasn’t been realized.

At some point that has to change, just as some point the strange relationship between energy prices and the stock market has to change.

That latter change may be happening now, as the decline in oil prices hasn’t taken the same toll on stocks that it would have just a month or two ago.

Or at least that what it seemed like this morning, but then the market today seemed to react negatively to a failed attempt to rally in the oil market and followed it lower.

So much for that theory.

Had this latest decline in oil happened in April, the market would have responded strongly lower, just as it responded strongly higher when oil prices went higher.

The muting of the relationship may herald the breaking of the relationship, but we may have to wait until tomorrow to get back on track.

With no trades even placed on the table yesterday and today, I don’t know if tomorrow will bring anything different.

All I would really like to do is sell some calls on uncovered positions, but it generally takes some sustained higher price moves to do that and none seem to be in the cards today.

With the real unknown coming on Friday there becomes less and less reason to want to get in front of that announcement as not only are the numbers in questions, but so would the response be hard to predict regardless of the numbers, direction or magnitude.

So this may be a very sleepy start to what is the least historic profitable month of the year.

Even as Japan announced a large economic stimulus package this morning, out own market appeared to not really care or maybe it just wanted to see details.

But if our futures couldn’t get very excited, I had a hard time doing so, as well and simply awaited some kind of a commitment in one direction or another.

That direction came, but not with enough gusto for my liking.

For now, as long as I don’t think that I’ll be doing too much trading this week, I’m actually alright with any outcome.

I wouldn’t mind some continued stability if it’s going to act
a
s a launch pad.

I also wouldn’t mind watching asset values move higher and getting a chance to sell some of those calls.

Finally, would it be that terrible to see some profit taking and the chance to perhaps find something more cheaply priced?

If only all of life had such equally acceptable possibilities.

.

.

Daily Market Update – August 2, 2016 (7:30 AM)

After 6 straight losing days we’re only about 8 points off the all time intra-day high on the S&P 500.

That’s the kind of support that needs to be built to have a platform to move higher and to create a situation where there could be a stopping station if it decides again to go lower.

Futures are again pointing mildly lower this morning, but there’s not too much reason to suspect that it will do anything other than continue to trade in a fairly narrow range.

At least until Friday when the Employment Situation report is released.

With the most recent GDP data release it’s hard to understand how the employment situation could be improving, but there hasn’t been too much of a correlation between the two for quite some time.

Even as wages increase and the unemployment rate falls, the expectation that a consumer led increase in the GDP would occur just hasn’t been realized.

At some point that has to change, just as some point the strange relationship between energy prices and the stock market has to change.

That latter change may be happening now, as the decline in oil prices hasn’t taken the same toll on stocks that it would have just a month or two ago.

Had this decline happened in April, the market would have responded strongly lower, just as it responded strongly higher when oil prices went higher.

The muting of the relationship may herald the breaking of the relationship.

With no trades even placed on the table yesterday, I don’t know if today will bring anything different.

All I would really like to do is sell some calls on uncovered positions, but it generally takes some sustained higher price moves to do that and none seem to be in the cards today.

With the real unknown coming on Friday there becomes less and less reason to want to get in front of that announcement as not only are the numbers in questions, but so would the response be hard to predict regardless of the numbers, direction or magnitude.

So this may be a very sleepy start to what is the least historic profitable month of the year.

Even as Japan announced a large economic stimulus package this morning, out own market appears to not really care or maybe it just wants to see details.

But if our futures can’t get very excited, i have a hard time doing so and will simply await some kind of a commitment in one direction or another.

For now, as long as I don’t think that I’ll be doing too much trading this week, I’m actually alright with any outcome.

I wouldn’t mind some continued stability if it’s going to act as a launch pad.

I also wouldn’t mind watching asset values move higher and getting a chance to sell some of those calls.

Finally, would it be that terrible to see some profit taking and the chance to perhaps find something more cheaply priced?

If only all of life had such equally acceptable possibilities.

.

.

Daily Market Update – August 1, 2016 (Close)

With August now getting ready to get underway, a quick look back shows that we’ve just come off 6 consecutive monthly moves higher.

That’s the case even as last week consisted of 5 consecutive losing days.

I didn’t mind that kind of a finish to July for a couple of reasons.

The first reason was that after the 9% run higher from the “Brexit” lows of barely a month ago, it was good to get some consolidation, even if it was minimal.

What is was, was orderly.

The other thing that really appealed to me is that the orderly decline came as oil had another bad week.

For stocks and oil to go their own ways hasn’t really been the story of 2016.

Sooner or later you had to believe that if oil prices were really being driven by supply excess in the face of reasonably healthy demand, that the market would move higher as oil moved lower.

Maybe that normal relationship can now begin and begin to take hold.

With still lots of earnings to come this week, but reasonably unimportant, we really are awaiting the retail reports that begin in a couple of weeks.

Those may tell us something different from what last week’s GDP said about the consumer led economy.

The other thing that may have an influence this week is Friday’s Employment Situation Report.

Lately, there has been a really good argument for not releasing that data on a monthly basis as the variances have been staggering.

There’s probably no telling where the numbers may be on Friday, just as there’s no telling what the reaction would be to any strong number.

My guess is that the market would finally start treating good news as good news and bad news for what it really is.

A strong employment number may be the signal to investors that the interest rate increase we’ve been waiting for all year is going to happen sooner rather than later, and perhaps with enough time to even squeeze an additional one in before year’s end.

This week I have no  expiring positions and only 2 ex-dividend positions, so I would like to supplement those with some income producing moves.

I would have loved to have had the opportunity to continue with last week’s ability to sell calls on uncovered positions that haven’t been doing me any good, even as they may have been collected dividends.

But that wasn’t going to be the case today as the market traded in a fairly tight range and with no conviction at all.

What it did do was to continue the losing streak and continue to distance itself from the direction of oil prices.

So I ended up doing nothing today.

While I’m not against spending down any of my limited cash reserve, i would much prefer to make use of whatever has been sitting around and still have some hopes of that being the case tomorrow.

With some of those positions, I’m also not opposed to continuing to sell longer term dated calls in an effort to collect some additional premium and maybe an extra dividend or two.

Even as volatility is so very low, some of those positions offer the chance to wait for their continued rebounds while enhancing their returns.

Ultimately, I would like to see them get assigned and contribute to the cash pile, but for now I do enjoy their climb, even if only valued in paper.

.

Daily Market Update – August 1, 2016 (7:30 AM)

With August now getting ready to get underway, a quick look back shows that we’ve just come off 6 consecutive monthly moves higher.

That’s the case even as last week consisted of 5 consecutive losing days.

I didn’t mind that kind of a finish to July for a couple of reasons.

The first reason was that after the 9% run higher from the “Brexit” lows of barely a month ago, it was good to get some consolidation, even if it was minimal.

What is was, was orderly.

The other thing that really appealed to me is that the orderly decline came as oil had another bad week.

For stocks and oil to go their own ways hasn’t really been the story of 2016.

Sooner or later you had to believe that if oil prices were really being driven by supply excess in the face of reasonably healthy demand, that the market would move higher as oil moved lower.

Maybe that normal relationship can now begin and begin to take hold.

With still lots of earnings to come this week, but reasonably unimportant, we really are awaiting the retail reports that begin in a couple of weeks.

Those may tell us something different from what last week’s GDP said about the consumer led economy.

The other thing that may have an influence this week is Friday’s Employment Situation Report.

Lately, there has been a really good argument for not releasing that data on a monthly basis as the variances have been staggering.

There’s probably no telling where the numbers may be on Friday, just as there’s no telling what the reaction would be to any strong number.

My guess is that the market would finally start treating good news as good news and bad news for what it really is.

A strong employment number may be the signal to investors that the interest rate increase we’ve been waiting for all year is going to happen sooner rather than later, and perhaps with enough time to even squeeze an additional one in before year’s end.

This week I have no  expiring positions and only 2 ex-dividend positions, so I would like to supplement those with some income producing moves.

I would love to have the opportunity to continue with last week’s ability to sell calls on uncovered positions that haven’t been doing me any good, even as they may have been collected dividends.

While I’m not against spending down any of my limited cash reserve, i would much prefer to make use of whatever has been sitting around.

With some of those positions, I’m also not opposed to continuing to sell longer term dated calls in an effort to collect some additional premium and maybe an extra dividend or two.

Even as volatility is so very low, some of those positions offer the chance to wait for their continued rebounds while enhancing their returns.

Ultimately, I would like to see them get assigned and contribute to the cash pile, but for now I do enjoy their climb, even if only valued in paper.

.