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Daily Market Update – December 6, 2016 (Close) Yesterday, at least for the most part, there were more indications that the Trump Rally was going to continue. This morning it looked as if markets would take a break, at least at the start. With more new closing records on the DJIA, 2016 looks as if it is going to end on a good foot. Last year, following a bump higher after the FOMC raised interest rates, the market gave up its head of steam heading into the close of the year and then simply proceeded to lose about 10% until turning around on a dime. This year, we may find ourselves being set up for the same thing, but the difference this year is that we may finally have a good earnings season to really bring us to a better place. Yesterday was another day to just go along for the ride and today was the same. I could get used to that. That has been much of the story with 2016, but as much as I may want to complain about the lack of trading on the year, with only 31 closed positions, when I look at the relative performance compared to the S&P 500, I don’t really have anything to complain about. What I thought that I’d end up doing today was just adding to the boredom of the whole year and that I would likely end up doing nothing. While I did make another DOH Trade yesterday, I decided not to make it part of the OTP Recommendation. Because we’re still having to manage last week’s DOH Trade, I thought that 2 of the same was just too many when faced with the unexpected runs higher that both of those positions have had. Sometimes there’s only so many things that you can balance when they all need undivided attention. So of course, I made another DOH trade today and again chose not to burden anyone with it, but it did seem as if some may have followed suit as I looked at the volume. The difference, though, was that instead of going for just a single week, I elected to go out 2 weeks on the expiration. So the week may still end up being a quiet one on a personal level, with the exception of a couple of expiring positions. Even as the market is heading toward these new highs, or maybe because of it, I am not minding increasing my cash position. At this point in time, I would actually love to see a 5% decline, now that I have sufficient enough cash to do something about relative bargains that might then appear. It has been a long time since that’s been the case. While I don’t expect that to happen, with next week’s FOMC Statement release, you still have to be prepared for the unexpected, regardless of how telegraphed things look at this moment in time. . |
