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Thursday, December 22nd, 2011
9:00am (EST)
Wednesday’s final numbers were about what we were hoping for as the market finished mixed. Much of yesterday’s session was spent in the red and at lunchtime we said we would be happy for a flat close although we knew the Nasdaq would struggle.
We took advantage of the lunchtime lows to open 2 more option trades yesterday and they have gotten off to a great start following the push during the final hour of trading.
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If you are not a subscriber but would like to read more and check our chart work for the Dow, S&P 500 and the Nasdaq please click here. We are one of the fastest growing stock options trading advisors on the internet. We offer powerful call and put option trades aimed at triple-digit returns for our Daily newsletter. Our Weekly Wrap Covered Call Portfolio strides for double-digit returns on a monthly basis. Sign-up now and receive access instantly!
Tags: binary options, call options, futures options, high beta stocks, Hot stocks, momentum options, Momentum stocks, option market, option tips, options, options mentoring, options trading, options trading course, stock market options, weekly options, what are options
Posted in Market Analysis, Market Commentary | Comments Off
Wednesday, December 21st, 2011
12:30pm (EST)
Futures have been all over the map today after trading higher throughout the morning before turning negative to flat before the open. Much of the pullback can be blamed on the talking heads wondering what the European banks are going to do with all that cash they are getting from the ECB (European Central Bank). We mentioned yesterday the ECB was offering 3-year loans for 1% so it was a no brainer they took the cash.
It doesn’t take a genius to see it’s a better deal to borrow at 1% rates than 4% rates but somehow the bears have convinced the talking heads and Wall Street there could be more of a crisis than feared.
Tech is getting hit the worst after Oracle (ORCL, $25.19, down $3.98) dropped the earnings ball. The company missed the Street’s expectations for profits of $0.57 a share on $9.23 billion in sales after posting $0.43 a share on revenue of $8.8 billion. Shares are down 14% on the news.
Wow.
With “pre-earnings” warnings season underway, Oracle should have gave the market a heads-up they were going to miss the boat by a mile, Needless to say shares are getting hammered after the company kept its pie hole shut.
As we head into the second half of trading, we are still hopeful for a flat to higher close. The good news if support holds is that we are the cusp of a serious breakout (or breakdown) with the scales tipping in favor of the bulls.
In our Weekly Wrap on Sunday we had this to say:
“We still believe there could be a year-end buying frenzy as Wall Street gets ready for 2012 but the major indexes will need a convincing burst past their 200-day moving averages to keep the momentum going.” (END)
We got that yesterday with the ECB and the market has already starting “decoupling” from Europe’s euro crisis. We also mentioned a number of other “bullish” things happening in the morning update and we also had this to say on Monday morning:
“There are 5 trading sessions left before Christmas is here and the market is closed next Monday. This means there are only 9 days left before the end of 2011. For you historian buffs, the market hasn’t had a losing pre-election year since 1939 so the bulls will be motivated to keep this streak alive. The other indexes have a little work to do but we saw some encouraging signs last week that still have us “bullish”. (END)
From a technical standpoint, today’s pullback is testing prior resistance which is trying to hold as support. It’s that simple so here is what we need to watch.
The 200-day MA for the Dow is at 11,936 which was cleared yesterday.
The 200-day MA for the Nasdaq is at 2,663 and the 50-day is at 2,617 so a close above the latter would be nice to see today but if 2,550 holds, we will be happy.
The S&P 500 closed above its 50-day MA of 1,230 on Tuesday and will face its next test at 1,250 and the 200-day MA of 1,259. A pullback to 1,225 should hold.
As we head to press, the Dow is down 65 points to 12,038 while the S&P 500 is off by 7 points to 1,234. The Nasdaq is showing a decline of 46 points to 2,558.
And drum roll please…the S&P Volatility Index is at 22.50, down 0.75. We have said since October the VIX would drop like a rock when it was in the upper 30’s and now a test to the teens could be coming.
We have 2 NEW TRADES we are recommending so let’s get to the Members Area. Subscribers, check for the updates and make sure you use limit orders today.
Tags: binary options, call options, futures options, high beta stocks, Hot stocks, momentum options, Momentum stocks, option market, option tips, options, options mentoring, options trading, options trading course, stock market options, weekly options, what are options
Posted in Market Analysis, Market Commentary, Trade Update | Comments Off
Wednesday, December 21st, 2011
9:15am (EST)
You could almost feel the market’s frustration with Europe and we told you a big move was coming either way once the situation came to a head. Following Monday’s pullback past support, the bulls were faced with a dilemma and looked as though they were either going to throw in the towel or come out fighting as the bottom of the current trading range appeared ready to fall.
We mentioned in our Weekly Wrap the bulls would need a catalyst or some good news to get their mojo back and here were some of our thoughts:
“There are 5 trading sessions left before Christmas is here and the market is closed next Monday. This means there are only 9 days left before the end of 2011. For you historian buffs, the market hasn’t had a losing pre-election year since 1939 so the bulls will be motivated to keep this streak alive. The other indexes have a little work to do but we saw some encouraging signs last week that still have us “bullish”.
We are also keeping a close eye on the Russell 2000 which may have bottomed after testing the 700 level once again. If this index can get back above 750 then it would be bullish. A drop below 700 would only confirm our bearish feeling.” (END)
The Dow soared 337 points, or 2.9%, to finish at 12,103. The blue-chips traded to a high of 12,117 and easily reclaimed the 11,800 and 12,000 resistance levels before running out of gas. These two areas will serve as short-term support again as the bulls’ eye another run back above 12,200. If cleared, there is a chance for a push up to 12,350-12,400 this week.
The S&P 500 jumped 36 points, or 3%, to settle at 1,241. The index went out near its high after getting past 1,225 but fell short of testing 1,250. This area has been a headache but if the market can clear this level then we can expect a test up to 1,275-1,300 over the next few weeks. The 1,200 level will still need to be watched if there is a pullback and 1,225 falls.
The Nasdaq zoomed 81 points, or 3.2%, to end at 2,603. Tech also went out near its high and the best news was the close above 2,600. This should clear the way for a run up to 2,650-2,675 if this level sticks with 2,550 providing short-term support. If the bulls can push 2,700 there could be a rush of cash coming off the sidelines.
The Russell 2000 added 30 points, or 4.2%, to close at 738.22. The index went out exactly on its high for the day and if you look at Sunday’s chart you will see why we are rooting for a close above 750.
The S&P 500 Volatility Index (VIX, 23.22, down 1.70) dropped 7% and traded to a low 22.54. Bingo. We have been harping on the 22.50 area since October.
Of course, yesterday’s rally won’t mean a hill of beans if the bulls are unable to hold these gains and advance past the next wave of resistance.
Futures are up as we head to press and look like this: Dow (+1); S&P 500 (-1); Nasdaq (+1). Subscribers, check the Members Area for the updates.
Tags: binary options, call options, futures options, high beta stocks, Hot stocks, momentum options, Momentum stocks, option market, option tips, options, options mentoring, options trading, options trading course, stock market options, weekly options, what are options
Posted in Market Analysis, Market Commentary, VIX | Comments Off
Thursday, December 15th, 2011
2:15pm (EST)
The market is trying to hold onto today’s gains following a strong open by the bulls on better-than-expected economic data. Futures were slightly higher before the bell but got a huge pop after jobless claims came in well below estimates. The session started with a bang as the Dow surged triple-digits at the open but the bears made an appearance shortly after the Philadelphia Fed report which caused a pullback despite better-than-expected numbers.
We said the bulls needed good news and today’s weekly jobless claims showed a drop to 366,000, which was below expectations for 390,000 claims. We were hoping for anything under 400,000 to avoid a selloff and the only thing that worries us is that the jobs report is seasonal right now. Meaning, what happens in January when all the Holiday Help is let go?
Elsewhere, the Producer Price Index (PPI) increased 0.3% versus expectations for a rise of 0.2%. The Empire Manufacturing Index came in at 9.5 which was much higher than the expected print for a 3.0 print. And finally, the Philly Fed Survey came in at 10.3 compared to expectations for a reading of 5.0.
It is nice to see a rebound but it is clear Wall Street remains concerned over the debt crisis in Europe. The major averages seem to be drifting sideways as we head to press and if the gains hold, it appears we could be stuck in a continuing trading range. At some point we will get a breakout or breakdown but it may not come until January as we see the market range bound through yearend.
The good news is we are building an impressive Watch List to play the market’s next move and we are getting close. In the meantime, we are also looking for a few more covered call candidates because if we do stay range bound we want to at least put some money to work.
As we head to press, the Dow is up 82 points to 11,905 while the S&P 500 is higher by 7 points to 1,219. The Nasdaq is showing a pop of 9 points to 2,548. Subscribers, check the Members Area for the updates.
Tags: binary options, call options, futures options, high beta stocks, Hot stocks, momentum options, Momentum stocks, option market, option tips, options, options mentoring, options trading, options trading course, stock market options, weekly options, what are options
Posted in Economic News | Comments Off
Tuesday, December 13th, 2011
9:00am (EST)
The market continued its recent zig-zag action on Monday with the bears starting the week off with a win. We knew yesterday’s momentum wasn’t going to be reversed so we focused on support which, once again, held despite some crummy headlines. We would love to have a day where we didn’t have to type in “Europe debt crisis” but until the picture becomes clearer, we are stuck.
The good news is that all of the uncertainty is coming to a head and we should get another major market wave higher or lower here soon. The bears have everything they need to spark a selloff, yet, the bulls continue to hold support while pounding away at resistance.
The Dow dropped 162 points, or 1.3%, to finish at 12,021. The blue-chips traded to a low of 11,940 after Wall Street’s lunch break but recaptured the 12,000 level by the closing bell. There is further risk down to 11,800 and then 11,600 while resistance remains at 12,200.
The S&P 500 gave back 19 points, or 1.5%, to settle at 1,236. The index reached a low of 1,227 but held 1,225-1,220 which is what we wanted to see. Further help is down at 1,200 while overhead resistance at 1,250 will be today’s focus.
The Nasdaq fell 35 points, or 1.3%, to close at 2,612. Tech fell below 2,600 and bottomed at 2,591 before rebounding to finish back above this level. There is further weakness down to 2,550-2,550 but we are expecting a push back towards 2,650.
The other index that kept us bullish was the S&P Volatility Index (VIX, 25.67, down 0.71) which actually declined nearly 3% despite the market pullback. The VIX traded to a high of 27.73 and never came close to cracking 30 despite a nasty day. We have been saying since October the VIX could hit the low 20’s which would get the S&P 500 to 1,275-1,300.
For those of you who are new subscribers and may not understand the VIX, it works like this. A “normal” VIX reading under 20 (bullish) indicates confidence and calm in the market while a reading above 30 (bearish) indicates nervousness and panic. Right now we are in the middle as the market tries to get back to “normal”.
Futures are showing a slightly higher open this morning: Dow (+61), S&P 500 (+8), Nasdaq (+18). Subscribers, check the Members Area for the updates.
Tags: binary options, call options, futures options, high beta stocks, Hot stocks, momentum options, Momentum stocks, option market, option tips, options, options mentoring, options trading, options trading course, stock market options, weekly options, what are options
Posted in VIX | Comments Off
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Dow and S&P Up, Tech Down
Thursday, December 22nd, 2011
9:00am (EST)
Wednesday’s final numbers were about what we were hoping for as the market finished mixed. Much of yesterday’s session was spent in the red and at lunchtime we said we would be happy for a flat close although we knew the Nasdaq would struggle.
We took advantage of the lunchtime lows to open 2 more option trades yesterday and they have gotten off to a great start following the push during the final hour of trading.
****************************
If you are not a subscriber but would like to read more and check our chart work for the Dow, S&P 500 and the Nasdaq please click here. We are one of the fastest growing stock options trading advisors on the internet. We offer powerful call and put option trades aimed at triple-digit returns for our Daily newsletter. Our Weekly Wrap Covered Call Portfolio strides for double-digit returns on a monthly basis. Sign-up now and receive access instantly!
Tags: binary options, call options, futures options, high beta stocks, Hot stocks, momentum options, Momentum stocks, option market, option tips, options, options mentoring, options trading, options trading course, stock market options, weekly options, what are options
Posted in Market Analysis, Market Commentary | Comments Off