We might get new money flow next week, but the way I see it is we will have more rotation than huge rallies in the indexes. We have a shortened week so be careful with weekly options. I am actually not too excited about most of the momo names (you can see my open interest...
Based on all the open interest I expect mostly chop next week and see more opportunities in fading rallies than going long them. When I say that I don’t mean that I think they will drop hard, but that if they get over their call walls and don’t keep running it’s probably worth selling a...
Since 2013 V-shaped bottom’s have been the modus operandi and this recent one has been no different, the S&P 500 rallying to new highs only 15 days after a 4.3% correction. Above is a chart that highlights all of those rallies from the bottom to the where the rally begins to stall and consolidate before then […]
Well, pretty amazing run. The way I see it right now is that SPX ran huge, but not all stocks participated. In the last two years every time we get a V-bottom we don’t end up having much of a retrace. We typically chop for a while before new highs. So if the indexes spend...
SPY: Well as if 200 wasn’t going to be resistance anyway. Let’s see if price gets over those calls and if the OI shifts. SPY could use a rest anyway. AAPL: This is the first time in a really long time that the puts are this high compared to the calls. AAPL may be...
Guest post written by Jerremy Newsome: @newsomenuggets After reviewing the energy sector I came across NRG, which broke through strong resistance in March after two failed attempts in October (see arrows). Recently the stock has retraced its entire bullish wave {from March to late June} back to that support at $29.00. On August 19th a one […]
Above is a chart displaying each correction over 5% since the March 2009 bottom (plus the recent 4.3% decline) color coded to the percentage of stocks that traded above the 50-day moving average during the correction. The following is based on an idea I got from Charlie Bilello’s work about the types of corrections we have […]
Since the recent 4.3% correction/pull-back from the high of 1991 on July 24th to a low of 1905 on August 2nd we have rallied 3.1% in just six trading days. The S&P 500 closed slightly above the 50-day moving average and based on recent market behavior after pull-backs, it would seem the easy money has been […]
I’m not sure what to expect next week. We have come a long way from 1900 in a short period of time and SPX held above the 50-day. However, as large as that moves seems it could still be a bounce. Holding the 50-day next week will be good and will lead me to think...
SPY: As of now this tells me we see some chop next week. If SPY does get over 197 and those calls don’t close out or it doesn’t convincingly get over them then it’s possibly worth a shot to get puts at least as a hedge since we have longs. AAPL: Nice close Friday, has...
That is what the market was up to today. Good job to anyone that sold premium this morning. Yields going back down and supposedly banks are a tiny bit (as in barely) more loose with their lending so go get that mortgage. GRUB was a huge win yesterday in case you missed me bragging about […]
But….I met Josh Brown who is one of the nicest most dynamic men I have ever met and look forward to upcoming interactions with him. I got to meet Barry Ritholz for a second as well; a bonus to an already awesome experience. Now regarding the markets today. Meh. They staged a small bounce in the […]
This post is written with regard to the short term trend. For the market going higher short term: We have not repaired being oversold on several metrics. The two charts displayed below are of S&P stocks making 20-day lows and S&P stocks below their 50-day MA Since 2013 all small dips have been buying opportunities. […]
With headline risk recently heating up, the SPX under its 50-day MA and the IWM under its 200-day MA things seem a bit murkier than they have in our previous quick stanp-back corrections that began in 2013. Furthermore, the impressive streak the European markets have had, notably the Germany’s Dax index, ended at the end […]
Well we finally got a decent bounce on Friday after waiting for it all week. Was that the bottom? I have no clue, but it doesn’t really matter either. For now we go with the bounce and see where it takes us. If SPY falls below 192, it will be less convincing that it was...
This is the monthly expiration so many of the heavy calls strikes (and sometimes puts depending on how heavy the market is) become walls. SPY: Unfortunately there is not too much we can glean from this open interest right now because there aren’t any outlier strikes here. 192 holding would be a good first step. AAPL:...
Very interesting the way the sell-off happened today. The first time SPX was making new lows, but there was divergences with breadth and some momo stocks either going up or holding well. Second time was a bit more pronounced, but still not crazy heavy as we have seen before. As I’ve been saying one of […]
There is a bounce coming somewhere. We have had three sessions in a row with a negative 1400 $TICK and the charts I have been posting regarding being oversold are either at levels we bounce off or very close. However, as I said this weekend in my Post Where’s the Bounce Yo, it seems too many […]
And I find it so unfortunate that I was not in it and did not participate in the fun. Very slow start to the day that ended up going much higher. I’m not sure if it was pure buying or short covering, but either way it went up. If we continue higher tomorrow in the […]
There is no doubt that their was damage done last week. Not just to the charts, but probably your psyche. Traders have been trained to buy every dip over the last couple of years, but last week, bounces were shallow and sold into. If you tried to catch a bounce and it didn’t work, let […]
SPY: We are already starting off way below those puts so unless we gap up strong there is nothing preventing us from going lower except the oversold readings we have. If we start pushing up through those puts, then all those puts could escalate the rally as market makers buy SPY to stay delta hedged. ...
Trend: Short-term: bearish Intermediate: mixed Long term: bullilsh We are in murky waters right now. Unless we are entering bear market territory, which is unlikely at this point, we are going to have a pretty decent rally at some point next week. When that happens we are not going to know yet if it is...
More For the Bulls to Cheer
The hallmark of this bull market has been rotation and for this rally to continue further that is what I expect will be the case. I tracked new highs from V-shaped reversals from late 2012 to this most recent pull-back and based on the average returns and length of the rally, the market has more upside […]
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