Daily Market Update – August 23, 2016

 

 

Daily Market Update – August 232, 2016 (9:00 AM)


There still isn’t too much on tap for this week as some jurisdictions have already started going back to school and the rest of us are trying to squeeze a last few days out of summer.

The market is higher in the pre-opening following a day yesterday that actually had some volatility, albeit in a pretty tight range.

Yesterday was a great reflection of just how undecided everyone happens to be, as we went up and down all through the day with no real news to account for anything.

While we do have some economic news this week and some more, although relatively unimportant earnings to come, the real news will be made in parsing the words coming from the attendees of the Jackson Hole meeting later in the week.

As the GDP is released on Friday, we will undoubtedly focus on what Janet Yellen says, which is expected to echo what Stanley Fischer said.

That is, we are pretty close to having the conditions to increase interest rates.

Will that be in September is the question for now. A strong GDP might make that the case.

Otherwise, we are quickly approaching the one tear anniversary of the first increase in about 9 years.

I did make one rollover trade yesterday and that leaves nothing else on the table.

No dividend positions, no expiring positions.

Nothing.

I either need to make some trades or have the market move some select stocks higher so that they can start making some money.

I don’t expect to do very much today, but that has been a recurring theme that I’m not thrilled about these days.


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Daily Market Update – August 22, 2016 (Close)

 

 

Daily Market Update – August 22, 2016 (Close)


There isn’t too much on tap for this week, what with summer winding down.

Although there will be a GDP release to end the week, the real news may come along with that summer ending tradition in Jackson Hole, Wyoming as the Kansas City Federal Reserve Bank holds its annual monetary policy symposium.

I wonder why they don’t hold it in Kansas City? At least the Missouri version.

That means that people will be listening to every word and every nuance to get some idea of when the FOMC may finally decide to raise rates.

If you listened to Stanley Fischer, the Vice-Chairman of the Federal Reserve, he indicated that the FOMC had pretty much all of the data it needed to do so.

In that case many will be looking for words of validation over the 2 days of the meeting which Janet Yellen skipped last year.

That meeting was a yawner, but it may be different this year, as Janet Yellen is scheduled to give a big speech and there may even be some wonder as to whether she is open to another term.

This week looks as if it will be getting off to a quiet start, continuing the pattern of the past few weeks.

Markets are still within easy reach of surpassing the all time high, which itself was more than 2% above the previously recognized high.

That’s something that has only happened 4 times in history, so this really is a pretty remarkable time.

This week may not be so remarkable, though.

I have some more cash available after the expiration of puts and that looked for a very short while as if it might be joined by cash from the assignment of a single lot of calls set to expire this week.

That is until I decided to keep the position alive by rolling it over in the face of a large decline in the shares today.

The trade off was that I was willing to take another 1.8% in income for an additional 2 weeks if the shares fell less than an additional 4% in that time period.

If it falls more, maybe I can keep the position alive even longer.

While I wouldn’t mind having some additional opportunities to generate income, I like the idea of collecting more cash in the event that we realize that there hasn’t been too much of a reason to have gotten to these new highs.

Beyond that, there’s also that pesky “sell on the news” phenomenon.

Still, while collecting more cash, I wouldn’t mind if this week does bring some more strength, if only to have the opportunity to finally sell some calls on positions that have been tantalizingly close the past few weeks and that have been begging for the opportunity to generate some income.

With no ex-dividend positions this week and now no more rollovers, the only prospects for generating cash this week are to either spend down some of the cash reserve or sell calls on uncovered positions.

I’d prefer the latter, but may be willing to take the former, especially if there is some profit taking early in the week.

Otherwise, I do like some of the earnings related positions highlighted this week, but as the caveat in the weekly article pointed out, I’m only likely to bite in the event of some sig
nificant drops after earnings and may be then more inclined to do traditional covered call trades, rather than selling puts, in the event that there is going to be an ex-dividend date near at hand.

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Daily Market Update – August 22, 2016

 

 

Daily Market Update – August 22, 2016 (8:30 AM)


There isn’t too much on tap for this week, what with summer winding down.

Although there will be a GDP release to end the week, the real news may come along with that summer ending tradition in Jackson Hole, Wyoming as the Kansas City Federal Reserve Bank holds its annual monetary policy symposium.

That means that people will be listening to every word and every nuance to get some idea of when the FOMC may finally decide to raise rates.

If you listened to Stanley Fischer, the Vice-Chairman of the Federal Reserve, he indicated that the FOMC had pretty much all of the data it needed to do so.

In that case many will be looking for words of validation over the 2 days of the meeting which Janet Yellen skipped last year.

That meeting was a yawner, but it may be different this year, as Janet Yellen is scheduled to give a big speech and there may even be some wonder as to whether she is open to another term.

This week looks as if it will be getting off to a quiet start, continuing the pattern o0f the past few weeks.

Markets are still within easy reach of surpassing the all time high, which itself was more than 2% above the previously recognized high.

That’s something that has only happened 4 times in history, so this really is a pretty remarkable time.

This week may not be so remarkable, though.

I have some more cash available after the expiration of puts and that looks as if it may be joined by cash from the assignment of a single lot of calls.

While I wouldn’t mind having some additional opportunities to generate income, I like the idea of collecting more cash in the event that we realize that there hasn’t been too much of a reason to have gotten to these new highs.

Beyond that, there’s also that pesky “sell on the news” phenomenon.

Still, while collecting more cash, I wouldn’t mind if this week does bring some more strength, if only to have the opportunity to finally sell some calls on positions that have been tantalizingly close the past few weeks and that have been begging for the opportunity to generate some income.

With no ex-dividend positions this week and no rollovers, the only prospects for generating cash this week are to either spend down some of the cash reserve or sell calls on uncovered positions.

I’d prefer the latter, but may be willing to take the former, especially if there is some profit taking early in the week.

Otherwise, I do like some of the earnings related positions highlighted this week, but as the caveat in the weekly article pointed out, I’m only likely to bite in the event of some significant drops after earnings and may be then more inclined to do traditional covered call trades, rather than selling puts, in the event that there is going to be an ex-dividend date near at hand.

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Dashboard – August 22 – 26, 2016

 

 

 

 

 

SELECTIONS

MONDAY:   Earnings are now coming to a trickle and there’s little to move markets other than economic data and FOMC members. The week looks like it will get started on a mildly lower bias, continuing the lack of conviction of the past few weeks.

TUESDAY:   Markets may move higher today, but for all intents and purposes, volatility is still on its summer vacation

WEDNESDAY: It looks like another flat morning as yesterday’s brief gains evaporated.

THURSDAY:  Oil has taken over markets the past couple of days, but for the next two, it may be a focus on whatever is said and overheard in Jackson Hole

FRIDAY:.  Today’s GDP will almost certainly be over shadowed by Janet Yellen speaking from Jackson Hole, as the market is treading water in the futures trading and trending lower for the week.


 

 



 

                                                                                                                                           

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Weekly Summary

  

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Weekend Update – August 21, 2016

We are pretty much done with the most systemically important earnings reports for this most current earnings season.

To say that it has been a confusing mix of results and projections would be an understatement.

By the end of the week, we had our fourth consecutive week of almost no net change. Yet the market remained within easy striking distance of its all time closing highs.

Why it’s at those all time closing highs is another question, but for the past 2 months the climb higher, while confounding, hasn’t disappointed too many people even as it’s given no reason to really be hopeful for more to come.

However, technicians might say that the lack of large moves at these levels is a healthy thing as markets may be creating a sustainable support level. 

That is an expression of hope.

Others may say that the clear lack of clarity gives no signal for committed movement in any direction.

That is an expression of avoidance, so as to preclude disappointment with whatever happens next. If you have no great hopes, you can’t really have great disappointment.

I buy into both of those outlooks, but have had an extraordinarily difficult time in believing that there is anything at immediate hand to use whatever support level is being created as a springboard to even more new highs.

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