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Thursday, May 17th, 2012
1:00pm (EST)
All signs were pointing towards a higher open for Wall Street and the bulls this morning but disappointing economic data ruined the mood as the bears continue to put pressure on the major indexes.
Initial Claims were unchanged at 370,000 after a revised 2,000 increase to 370,000 the week before. The 4-week moving average fell to 375,000 from 380,000 (revised from 379,000). Continuing Claims rose 18,000 to 3.265 million, up from a revised 3.247 million.
Futures got a small pop on the news as the bulls’ explored positive territory at the start of trading but the Philly Fed numbers after the open were a disaster. The survey showed a reading of -5.8, versus expectations for a number north of 10.
In addition to these uninspiring numbers, Leading Indicators dropped 0.1% following a 0.3% increase for the prior month which snapped a six-month string of gains.
The market has come up off its lows but the action is still ugly and we love it.
We were able to close 3 more trades for half profits today and we have a couple of other trades that are surging. We currently have a bevy of triple-digit winning option trades whose gains we are trying to protect. We have moved up the Hard Stops on a few of them and we have PROFITS to take on another trade that is up nearly 75%.
Ka-ching! Ka-ching! Ka-ching! That’s what it sounds like to ring the register which our subscribers continue to do.
As we head to press, the Dow is down 80 points to 12,518 while the S&P is lower by 10 points to 1,315. The Nasdaq is showing a decline of 31 points to 2,842.
Subscribers, check the Members Area for the important updates.
Tags: initial claims, Philly Fed, put option trading
Posted in Economic News, Trade Update | Comments Off
Friday, May 4th, 2012
9:00am (EST)
Thursday’s action on Wall Street favored the bears ahead of this morning’s Nonfarm Payrolls report.
The Dow dropped 62 points, or 0.5%, to close at 13,206. The blue-chips touched a low of 13,175 but held the 13,200 level after reaching a high of 13,284 intraday. Caterpillar (CAT, $100.67, down $1.96) accounted for negative 14 points which made up 20% of the Dow’s losses after nearly falling below triple-digits. The stock traded to a low of $100.50 and could be headed to $90 or worse on continued weakness.
The S&P 500 fell 11 points, or 0.8%, to settle at 1,391. The index made a brief appearance into positive territory and reached 1,403 before fading. A close below 1,400 would be bullish for next week. Anything below 1,375 would be bearish.
The Nasdaq declined 35 points, or 1.1%, to finish at 3,024. Tech had trouble holding the 3,050 level and fell below short-term support an hour into yesterday’s session. The low for the day was 3,016. Today’s action should have the index below this level or back above 3,050.
This morning’s eagerly awaited jobs report favors the bears as April Nonfarm Payrolls only showed an increase of 115,000 jobs. Wall Street was looking for a number north of 175,000.
Futures are showing a weak open and we couldn’t be happier: Dow (-41); S&P 500 (-4); Nasdaq (-7). Subscribers, check the Members Area for the latest updates and watch your email or Twitter accounts carefully. We could be ringing the register on a few more trades today.
Tags: April nonfarm payroll report, CAT, Caterpillat put options
Posted in Economic News, Market Analysis | Comments Off
Wednesday, May 2nd, 2012
2:00pm (EST)
The market is mixed as we head into the final few hours of trading. The bears got a nice jump at the bell following worse-than-expected data from the ADP Employment Change report which showed only 119,000 private-sector jobs were added in April. Wall Street was looking for a print of at least 170,000 job additions.
Elsewhere, Factory Orders also were slightly ahead of expectations, coming in at 1.5% for March, versus expectations for a 1.6% drop.
Thursday is a heavy day for the market as the Challenger Jobs Cuts will set the tone and comes out at 7:30am (EST). Initial and Continuing Claims are due out an hour before the bell along with the latest Productivity and Unit Labor Costs numbers. At 10am, the ISM Services report is due out.
Earnings for Thursday include: Bebe Stores (BEBE, $8.46, up $0.52), First Solar (FSLR, $18.09, down $0.33), General Motors (GM, $22.93, down $0.38), Liquidity Services (LQDT, $55.49, up $2.52), MGM Resorts (MGM, $13.73, up $0.44), Public Storage (PSA, $145.27, up $0.23) and Trimble Navigation (TRMB, $54,15, up $0.20).
As we head to press, here is how we look.
The Dow is down 24 points to 13,255 while the S&P is lower by 5 points to 1,400. The Nasdaq is up 4 points to 3,054.
Some of our current trades are doing well today so let’s go check on them as well.
Subscribers, check the Members Area for the updates.
Tags: Challenger Jobs Cuts, MGM, MGM Resorts earnings, momentum options, Momentum stocks
Posted in Earnings, Economic News, Market Commentary | Comments Off
Monday, April 30th, 2012
12:40pm (EST)
We stayed up late last night to watch the European open after finishing up our chart work. All of our homework suggests the market could make a big move this week, especially on Friday, but the direction is a little unclear. Despite the rally last week, the market is still in a tight 4-week trading range but now we are back at the top.
Futures were slightly higher at 2:30am (EST) when Bloomberg reported breaking news that S&P would downgrade 16 Spanish banks. Dow futures were up 31 points and fell 2 ticks on the news. At 3am, Spain’s GDP numbers came out and they were a train wreck.
The reaction was mild for the first hour of trading but before we hit the rack, Dow futures had been cut in half so we felt there was a chance the market could pullback to start the week.
Spain is now looking at a “bad bank” plan as a way to avoid a bailout. The country is holding talks to segregate troubled property loans into one or more asset management companies which would help struggling lenders. Sounds like another short-term fix to a longer-term problem that isn’t going away anytime soon. Spain is going to default but the market refuses to see it, right now.
Futures turned lower after economic news here at home came in worse-than-expected. Before the bell, Chicago ISM for April fell to 56.2 versus expectations for a reading of 60. Elsewhere, Personal Income rose 0.4% versus forecasts for a 0.3% increase. Personal Spending was up 0.3% which was slightly higher than the expected increase of 0.4%. This wasn’t really “good news” as consumers spent more on gas.
As far as the indexes, the bears are trying to get them below key levels as we head into the second half of trading.
The Dow is down 34 points to 13,194 and below 13,200 while the S&P is slipping 7 points to 1,396 and has given up the 1,400 level. The Nasdaq is off a double-deuce (22points) to 3,046 and is below the crucial 3,050 level.
We have a NEW TRADE we would like you to get into today and it is a CALL option on a stock we fell could explode in the coming months. We have gone out to July to take advantage of a possible 500% return.
Subscribers, check the Members Area for the updates and please use limit prices to get the best fills.
Tags: call option buying, Chicago ISM, Nasdaq 100 futures
Posted in Economic News, Market Analysis, Market Commentary | Comments Off
Thursday, April 19th, 2012
2:00pm (EST)
Futures can cause some sleepless nights which is one reason we don’t trade them because we would never get any sleep. When you are long call options and futures are showing a higher market before you hit the rack then you can sleep tight. However, when futures are soaring and you are short the market, or own put options, you might find yourself grabbing a midnight snack while checking on your computer.
We also like to say after-hours trading and futures don’t really count until the market opens. What really matters is the homework you do and keeping your emotions in check.
We had a feeling economic news would disappoint today and we also felt Spain’s bond auction wouldn’t be as smooth as Wall Street was predicting. And, after a slightly positive start, all three major indexes are firmly in the red as we head into the second half of trading.
Initial Claims came in at 386,000 versus expectations for a print of 370,000. Continuing Claims were 3.29 million versus expectations for 3.3 million. The Philadelphia Fed Manufacturing number disappointed at 8.5 which was well below the suit-and-ties guesstimates for a reading of 12. And finally, Existing Home Sales were also a drag as March sales came in at 4.48 million versus calls for 4.62 million units.
Earnings came in better-than-expected across the board this morning as a number of companies beat expectations but many are still missing on revenue numbers. The talking heads and Wall Street pros are saying companies are “beating” estimates but to us when you miss on 1 out of 2 estimates, you “missed” estimates. It’s kind of like the half empty/ half full argument.
As we head to press, the Dow is down 65 points to 12,966 while the S&P 500 is off by 7 points t o 1,378. The Nasdaq is lower by 15 points to 3,016.
We may have action to take on a few trades later this afternoon. The 4 trades we released on Tuesday are all doing well and they were meant to be “quick” hits, meaning we plan on being in and out as we wait for confirmation of a continued breakdown. Until it happens, it’s best to take profits while you can to continue building up your trading account.
Subscribers, check the Members Area for the latest updates!
Tags: bear market, continuing claims, Existing Home Sales, Philly Fed numbers
Posted in Earnings, Economic News, Market Analysis, Market Commentary | Comments Off
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Bear Struggling to Hold Losses
Wednesday, May 2nd, 2012
2:00pm (EST)
The market is mixed as we head into the final few hours of trading. The bears got a nice jump at the bell following worse-than-expected data from the ADP Employment Change report which showed only 119,000 private-sector jobs were added in April. Wall Street was looking for a print of at least 170,000 job additions.
Elsewhere, Factory Orders also were slightly ahead of expectations, coming in at 1.5% for March, versus expectations for a 1.6% drop.
Thursday is a heavy day for the market as the Challenger Jobs Cuts will set the tone and comes out at 7:30am (EST). Initial and Continuing Claims are due out an hour before the bell along with the latest Productivity and Unit Labor Costs numbers. At 10am, the ISM Services report is due out.
Earnings for Thursday include: Bebe Stores (BEBE, $8.46, up $0.52), First Solar (FSLR, $18.09, down $0.33), General Motors (GM, $22.93, down $0.38), Liquidity Services (LQDT, $55.49, up $2.52), MGM Resorts (MGM, $13.73, up $0.44), Public Storage (PSA, $145.27, up $0.23) and Trimble Navigation (TRMB, $54,15, up $0.20).
As we head to press, here is how we look.
The Dow is down 24 points to 13,255 while the S&P is lower by 5 points to 1,400. The Nasdaq is up 4 points to 3,054.
Some of our current trades are doing well today so let’s go check on them as well.
Subscribers, check the Members Area for the updates.
Tags: Challenger Jobs Cuts, MGM, MGM Resorts earnings, momentum options, Momentum stocks
Posted in Earnings, Economic News, Market Commentary | Comments Off