Daily Market Update – May 10, 2016

 

 

 

Daily Market Update – May 10, 2016 (7:30 AM)


Yesterday was one of those days that the market was pretty undecided about which direction to take, but to its credit it didn’t follow oil in its course reversal.

Futures had started strongly yesterday, but were eroding even as oil was doing well.

When oil strongly reversed course, the expectation might have been that stocks would have followed, but they didn’t.

This morning’s futures have both oil and stocks heading in the same direction, with the DJIA futures in triple digit gain territory.

With some preliminary retail data last week and some early earnings already reported this week, it looks as if retailers may not have much in the way of good news.

While we’ve gotten used to a year’s worth of disappointments from The Gap, hearing the same from The Limited caught just about everybody by surprise.

This week and next the major national retailers report earnings and what is likely to be key is what kind of optimism or pessimism they’re going to express for the rest of 2016.

The expectations are already low, but there isn’t likely to be any reward for trying to lengthen out the period of low expectations.

So far, this earnings season has punished companies that may have been lowered expectations, but still cast a negative tone on their guidance.

With a single new purchase yesterday, I’m still open to the possibility of more this week, but am still looking forward to seeing the end of the May 2016 option cycle and having a chance to move forward.

With so few weekly options in hand and more of them with monthly or beyond expirations, the trading has slowed down so much. For some of those positions I was just happy to get any kind of opportunity to sell a contract and I would still take some more of those opportunities while trying to wait out some precipitous declines.

With the market pointing nicely higher this morning, i would gladly give up some opportunity to add new positions in exchange for being able to sell some calls on uncovered positions, or at least get the chance to either roll over the single expiring position this week.

Those are just my own lowered expectations.

Daily Market Update – May 9, 2016 (Close)

 

 

 

Daily Market Update – May 9, 2016 (Close)


There really isn’t too much in the way of economic news this week, but some of the important components of the GDP will be releasing their earnings reports this week and next.

With GDP estimated to be composed nearly 70% of consumer spending, it may be a big deal when the major national retailers begin to report their earnings.

Last week’s monthly sales data from The Limited cast a pall on retailers and many are talking about rising inventories and big sales as the winter was coming to its close.

With expectations already fairly low, it seems that people are looking for further disappointment.

The one thing that we have seen this earnings season is that when those lowered expectations aren’t met or when continued weak guidance is given, there isn’t a lot of forgiveness offered.

In the meantime, the futures trading in oil was higher, but stocks were seeing their early gains erode as the opening bell was approaching. 

In a very positive note, even as the DJIA fell by 35 points and the S&P 500 actually added a point, they both did so while oil was completely turning around from its morning trading to see it close the day much, much lower.

But stocks didn’t follow.

With disappointing employment numbers and increasing oil prices, it’s hard to see where the good news is going to come from or where the FOMC is going to draw its data to warrant their acting on another interest rate increase.

With absolutely no trades last week, I at least had some dividends to fall back upon.

That’s not the case this week, so I was anxious to make some trades once the session got underway and, as expected, I went after volatility and liquidity, trying to make up for lack of quantity of trading.

At the moment, I would just like this monthly option cycle to come to an end, as I do have some expiring positions next week and that may give an opportunity to at least do something to generate some income., even as that stock took some punishment before the day was over.

Daily Market Update – May 9, 2016

 

 

 

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


There really isn’t too much in the way of economic news this week, but some of the important components of the GDP will be releasing their earnings reports this week and next.

With GDP estimated to be composed nearly 70% of consumer spending, it may be a big deal when the major national retailers begin to report their earnings.

Last week’s monthly sales data from The Limited cast a pall on retailers and many are talking about rising inventories and gig sales as the winter was coming to its close.

With expectations already fairly low, it seems that people are looking for further disappointment.

The one thing that we have seen this earnings season is that when those lowered expectations aren’t met or when continued weak guidance is given, there isn’t a lot of forgiveness offered.

In the meantime, the futures trading in oil was higher, but stocks were seeing their early gains erode as the opening bell was approaching.

With disappointing employment numbers and increasing oil prices, it’s hard to see where the good news is going to come from or where the FOMC is going to draw its data to warrant their acting on another interest rate increase.

With absolutely no trades last week, I at least had some dividends to fall back upon.

That’s not the case this week, so I may be anxious to make some trades once the session gets underway and I’m likely going to go after volatility and liquidity, trying to make up for lack of quantity.

At the moment, I would just like this monthly option cycle to come to an end, as I do have some expiring positions next week and that may give an opportunity to at least do something to generate some income.

Right now I don’t ask for much, but any kind of a trade would be very welcome.

Dashboard – May 9 – 13, 2016

 

 

 

 

 

SELECTIONS

MONDAY:   Not too much going on this week, but retailers are reporting earnings and they’re not expected to be very good, maybe even below lowered expectations. Well, at least we have oil higher this morning

TUESDAY:   Markets point toward a higher open this morning as oil is also showing some strength. The real test comes as retailers are now reporting numbers and the weak are getting weaker. If the big players are the same, the market probably won’t react kindly

WEDNESDAY:  After yesterday’s 222 point gain, coincidentally while oil also headed much higher, this morning may give a small portion back. That portion could change as big retailers begin their flow of earnings reports starting today.

THURSDAY: Up 222 on Tuesday, down 217 yesterday. Well, at least that’s a net gain of 5. This morning’s futures are mildly higher, as is oil, trying to recover from yesterday’s retailer shock

FRIDAY:.  The week looks as if it wants to end on a flat note, having been punctuated mid-week by equally large and opposite moves. More retail next week, but maybe we’re now prepared for the moribund consumer and the economy he created

 

 

 



 

                                                                                                                                           

Today's TradesCash-o-Meter

 

 

 





 “SNEAK PEEK AT NEXT WEEK” APPEARS ON FRIDAYS

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Weekly Summary

  

Weekend Update – May 8, 2016

Depending upon how concrete you are in interpreting the meaning of the concept of “the circle of life,” the beginning and the end of that circle must be identical events as their points in space are coincident.

Various religions and philosophies believe that through a certain life path, another life awaits, but the rigorous requirements of geometry may be put aside in the process.

It’s also not clear that there had been any data dependency in the formulation of the philosophical concept.

Life, death and re-birth almost reads like a stock chart, except that the stock chart is plotted over time.

While new life generally brings joy, a geometric centric definition of “the circle of life” would both begin and end with that kind of joy.

On the other hand, a more philosophical interpretation of the concept has some diametrically different events, death and life, coinciding as the circle is closed.

Philosophy aside, markets have their own circle of life.

Start where you like in defining that circle, but among the components are low interest rates; increasing business investment for growth; increasing productivity; increasing corporate profits; increasing employment; increasing consumer spending; higher prices; higher interest rates; decreasing business investment; decreasing productivity;  decreasing employment; decreasing consumer spending and on and on.

That’s more or less a traditional look at the way things usually go, but at the moment it’s hard to know where in that circle we are or if we even have a circle.

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