Author: TheAcsMan

Daily Market Update – July 12, 2016 (Open)

This morning’s futures trading was telling us to expect that the all time closing and intra-day highs on the S&P 500 were safe.

That’s pretty unusual behavior not to want to test those old highs, but the predominant wave of opinion was so strongly that of finding no justification for the market to go higher that there was probably no option to do anything than to go higher.

This morning’s futures are looking to do just that, but with some degree of moderation.

Ultimately, if new highs are going to be sustained it’s far more likely to happen if the path comes through moderate moves higher, rather than a breakout.

With earnings now about to get into gear in a couple of days, despite some early earnings having started at yesterday’s close, the question will become just how much of a dampening effect might come from Brexit related guidance, especially from the financial sector.

The financial sector really kicks things off on Thursday and we get some idea.

Rarely does a weak financial sector at the time of earnings put the market into a happy place.

So there may be a battle ahead for the hearts and minds of investors.

For my part, I just want to leave the July 2016 option cycle in a few days with some assignments and some rollovers.

I’m not thinking very much in terms of what awaits, but rather what is in the here and now.

With the chance of some of those assignments and rollovers and sufficient uncovered positions, I wouldn’t mind a breakout and would certainly take any opportunity to sell calls on those uncovered positions in the belief that any breakout would be only a blip.

For that reason, I might consider longer term call options on those uncovered positions and adding some dollars to the “at cost” strike levels.

In theory, that sounds good, but first we need that breakout.

With earnings ahead and the FOMC to follow in a couple of weeks, there may be lots to give the market something to think about and maybe lots to make it move in either direction.

I just want to be ready and not flatfooted as 2017 is not too far around the corner at this point.

Daily Market Update – July 8, 2016 (Close)

This morning’s futures trading was telling us to expect that the all time closing and intra-day highs on the S&P 500 were about to give way to new ones.

Before that happens, though, the previous highs, representing resistance levels have to be tested. At least, that’s usually the case.

Often, the market has to make more than one run at those levels before actually breaching them and establishing a new level of support.

Following Friday’s Employment Situation Report there was enough good news in terms of job creation to give logical reason for the market to celebrate and today, at least, there didn’t even seem to be any reason to test those resistance levels.

At some point all the logical people in the world should have eventually come to the conclusion that more people getting jobs is a good thing even as it might lead to some inflation and wage inflation.

That’s especially the case as we see so much of the rest of the world getting mired in such a low rate and even negative rate environment and unable to sustain any kind of growth, at all.

There’s nothing wrong with growth, especially if its in moderation and for the moment, our economy and our stock markets are the best in the world.

This week doesn’t have too much going on, although there are 13 different speeches being given by members of the Federal reserve and some of those are likely to get a response from traders.

Those come in advance of the July 2016 FOMC meeting and on the heels of last Friday’s Employment Situation Report, you do have to wonder whether that may be the trigger to finally go ahead with the increase that we’ve all been expecting for the past few months.

I do have some cash this week and was willing to spend it as the July 2016 option cycle comes to its end.

Spending it on the same thing over and over again suits me just fine

Although I do have a number of positions set to expire this week and with some assignment or rollover prospects, I wouldn’t mind adding even some more income, especially since there are no ex-dividend positions this week.

What I didn’t expect to do was to jump in if the market shows too much strength to open the week, although individual stock weakness could be a draw.

Otherwise, earnings begin anew this week and it will be interesting to keep an eye on the financials as they could set the tone in a bad way as the lower interest rate environment hasn’t been good for them and many will start guiding lower as thoughts of the impact of the “Brexit” vote crystallize.

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Daily Market Update – July 8, 2016 (9:00 AM)

This morning’s futures trading is telling us to expect that the all time closing and intra-day highs on the S&P 500 are about to give way to new ones.

Before that happens, though, the previous highs, representing resistance levels have to be tested. At least, that’s usually the case.

Often, the market has to make more than one run at those levels before actually breaching them and establishing a new level of support.

Following Friday’s Employment Situation Report there was enough good news in terms of job creation to give logical reason for the market to celebrate.

At some point all the logical people in the world should have eventually come to the conclusion that more people getting jobs is a good thing even as it might lead to some inflation and wage inflation.

That’s especially the case as we see so much of the rest of the world getting mired in such a low rate and even negative rate environment and unable to sustain any kind of growth, at all.

There’s nothing wrong with growth, especially if its in moderation and for the moment, our economy and our stock markets are the best in the world.

This week doesn’t have too much going on, although there are 13 different speeches being given by members of the Federal reserve and some of those are likely to get a response from traders.

Those come in advance of the July 2016 FOMC meeting and on the heels of last Friday’s Employment Situation Report, you do have to wonder whether that may be the trigger to finally go ahead with the increase that we’ve all been expecting for the past few months.

I do have some cash this week and am willing to spend it as the July 2016 option cycle comes to its end.

Although I do have a number of positions set to expire this week and with some assignment or rollover prospects, I wouldn’t mind adding some more income, especially since there are no ex-dividend positions this week.

What i don’t expect to do is to jump in if the market shows too much strength to open the week, although individual stock weakness could be a draw.

Otherwise, earnings begin anew this week and it will be interesting to keep an eye on the financials as they could set the tone in a bad way as the lower interest rate environment hasn’t been good for them and many will start guiding lower as thoughts of the impact of the “Brexit” vote crystallize.

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Daily Market Update – July 8, 2016 (7:30 AM)

The Week in Review will be posted b y 10 PM and The Weekend Update will be posted by noon on Sunday.

The following trade outcomes are possible today:

Assignments:  none

Rollovers:  MRO

Expirations:   none

The following were ex-dividend this week:   CSCO (7/5 $0.26)

The following will be ex-dividend next week:   none

Trades, if any, will be attempted to be made prior to 3:30 PM EDT.

Daily Market Update – July 7, 2016 (Close)

Yesterday would have been a good day to take a little bit of a break.

It did do just that until about noon and then it just became another day of gains and another day getting closer to the resistance points that reside ahead.

This morning, following those gains, which left the market closing at its highs, looked as if it was going to take another break.

This time, if it did, but only after oil reversed course.

Still it may have been a pragmatic break, because tomorrow brings what could be an important bit of economic news.

With the release of the Employment Situation Report we can either confirm the last shockingly low number which definitely scuttled plans for an interest rate increase or we can disavow those numbers as either a one time or maybe even erroneous data set, as revisions are always possible.

Either way, that could mean some significant activity.

Of course, there’s also the possibility that tomorrow’s numbers will be mediocre and the market may continue to be of a mindset to think of that as good news for stock investors, as interest rates will continue to decline.

With only a single position set to expire this week, and a highly volatile one at that, it’s again another situation of not minding if I could roll that single position over, rather than seeing it get assigned.

With some positions set to expire next week as the July 2016 option cycle comes to its end, but no ex-dividend positions, I may still want to free up some additional funds, 

So there may not be much trading left in me for this already trade shortened week, although if the market does react negatively to the news on Friday, I may want to get a head start on the consideration of new positions for the following week, especially if that single expiring position is still in line for assignment.

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

Yesterday would have been a good day to take a little bit of a break.

It did do just that until about noon and then it just became another day of gains and another day getting closer to the resistance points that reside ahead.

This morning, following those gains, which left the market closing at its highs, looks as if it is going to take another break.

This time, if it does, it may be a pragmatic break, because tomorrow brings what could be an important bit of economic news.

With the release of the Employment Situation Report we can either confirm the last shockingly low number which definitely scuttled plans for an interest rate increase or we can disavow those numbers as either a one time or maybe even erroneous data set, as revisions are always possible.

Either way, that could mean some significant activity.

Of course, there’s also the possibility that tomorrow’s numbers will be mediocre and the market may continue to be of a mindset to think of that as good news for stock investors, as interest rates will continue to decline.

With only a single position set to expire this week, and a highly volatile one at that, it’s again another situation of not minding if I could roll that single position over, rather than seeing it get assigned.

With some positions set to expire next week as the July 2015 option cycle comes to its end, but no ex-dividend positions, I may still want to free up some additional funds, 

So there may not be much trading left in me for this already trade shortened week, although if the market does react negatively to the news on Friday, I may want to get a head start on the consideration of new positions for the following week, especially if that single expiring position is still in line for assignment.

Daily Market Update – July 6, 2016 (Close)

Yesterday was a day to take a little bit of a break.

After such strong gains following the large post-Brexit decline, it was probably a good thing to take that kind of a break and to set up a floor from where to make an attack on intermediate and all time highs on the S&P 500.

Both were a little bit further away as this morning was ready to get started, but both were still easy within reach and that reach got even easier by the day’s close as the market made a big turnaround and started posting gains by Noon.

Even more positive is that the market again closed right near its high for the day. 

That was a trend that actually started last week, even on the solitary down day to begin that week.

The market now seems even pretty well positioned to start to attack those support levels at about 2112 and 2137.

The expectation would be that the 2112 may be breached fairly easily at this point, but may still need to be tested.

The 2137 will be more difficult, but days of consolidation of gains, such as yesterday and maybe again today can make it easier to make those assaults as a new level of support is created after the recent large gains.

Yesterday had the usual culprits for a weak market.

Oil was very weak, gold was strong and interest rates went even lower.

Add to that the strength in the US Dollar and you had the equation that would lead to stock selling.

This morning oil wasn’t very weak, but nothing else has really changed in the world, otherwise.

What did change was that oil reversed its direction and took the market along with it.

While the futures were again pointing to some weakness, I would have preferred that over the way the day finally worked out. Some modest declines may not have been such a bad thing, as the big picture evolves.

Today we got some more insight into what the FOMC had been thinking and we may continue to have reason to question the health of our own economy, although the doubts could be set aside with a rebound in the Employment Situation Report numbers on Friday.

That would certainly confuse things and probably further test support.

I don’t expect to be doing much more this week, having made a single purchase and with the big question marks that serve as overhangs.

That will all bring us to the following week and the beginning of another earnings season where we may begin hearing a lot about the risks associated with Brexit.

Those could serve as real headwinds to stocks as guidance may be pessimistic, but next week is still an eternity away.