Week in Review – September 26 – 30, 2016

 

Option to Profit

Week in Review


September 23 – 27, 2016

NEW POSITIONS/STO NEW STO ROLLOVERS CALLS ASSIGNED/PUTS EXPIRED CALLS EXPIRED/PUTS ASSIGNED CLOSED EX-DIVIDEND
1  /  1 0 0 1   /   1 0   /   0 0 3

 

Weekly Up to Date Performance

September 23 – 27, 2016

What a week this was.

Add to it the Friday close from the previous week and we had 6 consecutive triple digit moves, with the market finally ending higher on the week’

There wasn’t much in the way of a theme this week, despite about 17 scheduled appearances by members of the Federal Reserve.

What there was lots of back and forth.

There was one new position opened this week and it was one designed to capture a dividend and hopefully get assigned as its monthly option is due to expire.

That position was up 5.8% for the week, while the adjusted and unadjusted S&P 500 were both only 0.2% higher.

With all of that movement, only 0.2%.

Imagine that.

Existing positions were again responsive to energy and commodity positions which were all over the place this week. When Friday’s rally finally settled, those existing positions were actually 0.6% higher than the S&P 500 for the week, despite the weakness in oil and commodities.

There were two new closed positions for the week, both old friends.

One, an old friend because it was held for about 529 days and the other, because it was one of 8 times that same stock has been closed out in 2016.

Positions closed in 2016 were 0.3% higher, as compared to the overall market, which was 5.6% higher during the same time frame. Of course, the defunct MolyCorp, whose positions were closed out this year are responsible for that adverse comparison, which is on a non-weighted basis.

Without those MolyCorp shares the remaining shares would have been 7% higher, versus 2% for the S&P 500.< /strong>

I wasn’t expected to do very much this week, as there was plenty of reason to expect confusion, with so many Federal Reserve members putting in their two cents.

It was an orderly confusion, though, as we basically went back and forth, albeit in relatively big chunks from one day to the next.

I was a little surprised to have opened a new position and very happy to have been able to see 2 others get cashed out.

Although I was pleased on a net basis for the week, I would have really liked to have had some opportunities to sell calls on uncovered positions.

It wasn’t for a lack of trying. It has just been that with the volatility so low, it’s really hard to justify selling the rights to shares for such pittances.

Still with 3 ex-dividend positions, including one with 3 lots and the other two with each 2 lots of shares, there was enough income generation for me, as long as 2016 is used as the baseline.

Of course, even by 2015 standards, which was already a fairly quiet trading year, 2016 has been a sleeper, even as net asset values are rising nicely.

It’s just that those increasing net asset values don’t necessarily materialize into realized gains and they don’t necessarily result in income production.

That, in part, explains the hunger for dividends, even as dividends really represent a zero sum game of sorts.

With cash being generated from 2 positions, one assigned short call position and one expired short put position, I do have some extra cash to spend in the coming week.

With no expiring positions next week and only 2 ex-dividend positions, I wouldn’t mind adding something to that mix, so I may be on the lookout for something on Monday morning.

Ultimately, it will likely be as it has been for what feels like the longest time.

I just want to sell some calls on uncovered positions and maybe see some assignments as the October 2016 contracts come to their conclusion.

That’s not asking too much.


This week’s details may be seen in the Weekly Performance spreadsheet * or in the PDF file, as well as in the summary below

(Note: Duplicate mention of positions reflects different priced lots):



New Positions Opened:  CY

Puts Closed in order to take profits:  none

Calls Rolled over, taking profits, into the next weekly cycle:   none

Calls Rolled over, taking profits, into extended weekly cycle:  none

Calls Rolled over, taking profits, into the monthly cycle: none

Calls Rolled Over, taking profits, into a future monthly cycle:  none

Calls Rolled Up, taking net profits into same cyclenone

New STO: none

Put contracts expired: MRO

Put contracts rolled over: none

Long term call contracts sold:  none

Calls Assigned:  BBY

Calls Expired:  none

Puts Assigned:  none

Stock positions Closed to take profits:  none

Stock positions Closed to take losses: none

Calls Closed to Take Profits: none

Ex-dividend Positions   CY (9/27 $0.11), DOW (9/28 $0.46), WFM (9/29 $0.135)

Ex-dividend Positions Next Week:  

For the coming week the existing positions have lots that still require the sale of contracts:   AGQ, ANF, AZN, BBBY, BBY, CHK, CLF, COH, CSCO,  CY, DOW, FAST, FCX, GDX, GM, GPS, HAL, HFC, HPQ, INTC, IP, JCP, JOY, KMI, KSS, LVS, MCPIQ, MOS, NEM, RIG, WFM, WLTGQ, WY (See “Weekly Performance” spreadsheet or PDF file)



* If you don’t have a program to read or modify spreadsheets, you can download the OpenOffice Suite at no cost.



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Daily Market Update – September 30, 2016

 

 

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


The Week in Review will be posted by 10 PM and the Weekend Update will be posted by Noon on Sunday.

The following trade outcomes are possible today:

Assignments: none

Rollovers: Best Buy

Expirations:   MRO puts

The following were ex-dividend this week:    CY (9/27 $0.11), DOW (9/28 $0.46)

The following are ex-dividend next week:  GPS (10/3 $0.23), BMY (10/5 $0.38)

Trades, if any, will be attempted to be made prior to 3:30 PM EDT

.


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Daily Market Update – September 28, 2016

 

 

Daily Market Update – September 29, 2016 (7:30 AM)


Yesterday marked the fourth consecutive triple digit move.

After oil having made a large move lower on Tuesday and markets not following suit, yesterday was a completely different story.

For the most part the market completely ignored Janet Yellen’s appearance before Congress and instead it did nothing until an OPEC agreement came along to cut production.

At that moment, just as oil prices started their climb, the market went back to its pattern all through 2016, of simply following oil.

It did it again and rallied to that fourth consecutive triple digit move, once again taking the market higher.

The moves yesterday and on Tuesday higher erased the downward moves the prior 2 trading days.

That leaves the market ready to begin the morning with a GDP release and then the stream of Federal Reserve members coming through the day.

The week originally had 12 such appearances, but that had gone up to 17, with 6 of those, including Janet Yellen happening today.

So, it may be understandable why the futures markets are completely flat this morning.

It may be interesting to watch the numbers through the day at 8:30, 8:45, 10:00, 10:15, 1:30 and then seeing what further talks at 4:30 and 7:15  may do for tomorrow.

Originally this week, Janet Yellen was scheduled to be the last speaker from the Federal reserve, but that’s no longer the case, as today’s schedule has really been shuffled around and a speaker has now appeared on Friday, as well.

But it may be a busy day as the battle of words and thoughts gets underway.

There’s probably nothing to do but to try and not become collateral damage.


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Daily Market Update – September 28, 2016

 

 

Daily Market Update – September 28, 2016 Close)


Yesterday marked the third consecutive triple digit move.

Even though at these levels a simple triple digit move doesn’t mean as much as it once did, they are still relative anomalies.

Yesterday was also another day where there wasn’t much reason for that triple digit move, unless you believe that the previous two moves lower just created an over-sold condition and that the market had no recourse but to bounce back.

That , of course, ignores past instances where more than 2 days of large losses have been followed by a third, maybe even a fourth day of large losses.

This morning, there was again nothing to really give markets an excuse for a large move.

The difference, at least early in the morning was that maybe today could have been the day that the market may actually not have made any big moves.

Logically, that could have been the case for today and tomorrow, as we waited for the GDP to be released on Friday.

Yesterday’s common sense, that is, the market not following oil lower, as there was word that there would not likely be a production cut, didn’t hold today.

In fact, the market turned higher, even as it was lulled to sleep with Janet Yellen’s congressional testimony, precisely when an agreement was reached to cut oil production.

Sure, it makes no sense for the market to respond positively to what kind only be bad news, but maybe any inflation is good inflation.

With a couple of positions set to expire this week, at this point I want to see them add to cash reserves.

That means assignment of the short calls and expiration of the short puts.

Both are possible, but I wouldn’t necessarily be upset if that’s not the case, as long as there is some reasonable opportunity to keep those positions alive and generating revenue.

When we get to the mid-week, I already start thinking about what the next week may hold, but this week, as it often is when there’s a big economic release on a Friday, such as with the GDP and the Employment Situation Report, I suspend those thoughts and await what Friday will bring.

I had wanted to see some pullback this week, but now would like to see some good GDP news, in the belief that will spur buying, as investors come to grips with an increasing likelihood of a rate increase in December.

As long as that increase doesn’t come as a surprise sometime sooner, I think that a flow of good economic news heading into the December FOMC meeting, particularly if also coupled with positive guidance as the next earnings season begins in a couple of weeks, could send us toward and beyond market highs.

I don’t have a kidney stone at the moment, but that’s one ride I’d like to go on as we head into 2017.


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Daily Market Update – September 28, 2016

 

 

Daily Market Update – September 28, 2016 (7:30 AM)


Yesterday marked the third consecutive triple digit move.

Even though at these levels a simple triple digit move doesn’t mean as much as it once did, they are still relative anomalies.

Yesterday was also another day where there wasn’t much reason for that triple digit move, unless you believe that the previous two moves lower just created an over-sold condition and that the market had no recourse but to bounce back.

That , of course, ignores past instances where more than 2 days of large losses have been followed by a third, maybe even a fourth day of large losses.

This morning, there is again nothing to really give markets an excuse for a large move.

The difference may be that today the market may actually not make any big moves.

That may end up being the case for today and tomorrow, as we wait for the GDP to be released on Friday.

With a couple of positions set to expire this week, at this point I want to see them add to cash reserves.

That means assignment of the short calls and expiration of the short puts.

Both are possible, but I wouldn’t necessarily be upset if that’s not the case, as long as there is some reasonable opportunity to keep those positions alive and generating revenue.

When we get to the mid-week, I already start thinking about what the next week may hold, but this week, as it often is when there’s a big economic release on a Friday, such as with the GDP and the Employment Situation Report, I suspend those thoughts and await what Friday will bring.

I had wanted to see some pullback this week, but now would like to see some good GDP news, in the belief that will spur buying, as investors come to grips with an increasing likelihood of a rate increase in December.

As long as that increase doesn’t come as a surprise sometime sooner, I think that a flow of good economic news heading into the December FOMC meeting, particularly if also coupled with positive guidance as the next earnings season begins in a couple of weeks, could send us toward and beyond market highs.

I don’t have a kidney stone at the moment, but that’s one ride I’d like to go on as we head into 2017.


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Daily Market Update – September 27, 2016 (Close)

 

 

Daily Market Update – September 27, 2016 (Close)


Markets looked as if they were going to open on the calm side this morning after posting two consecutive triple digit losses for the first time since the Brexit vote.

There wasn’t much of a reason for either of the past two declining days, just as there’s not too much reason for any significant moves for the rest of the week, except perhaps Friday.

Of course, when there’s no reason, there’s reason to suspect just the opposite and that was again the case today, but this time in a different direction.

Today, it looked as if the markets may have taken their cue from Asian markets, but the buying accelerated as oil began falling, on news that it wasn’t too likely that anyone could agree on production cut backs.

That, at least, was nice to see.

Finally, a normal response to a supply side glut of oil.

With that done, maybe the market will gravitate toward calmness until Friday. That’s when the GDP is released and a surprising number could really move markets that are now expecting that there will be an interest rate increase in December. That would probably require some positive economic news and the GDP is a good place to start, especially if there are some upward revisions.

In the meantime, there are still lots of Federal reserve members set to speak this week and any of them has the power to move markets, even if only for a few hours until a counter-position is voiced.

With a purchase of shares yesterday that happened to be ex-dividend today, I don’t expect to be spending much more money this week, unless it looks as if I will be able to realize some new cash from those positions whose short option contracts expire this week.

There’s little reason to expect any sustained move higher while we await December, but with earnings about to start again in 2 weeks, it will be interesting to see whether or not companies are seeing anything hopeful ahead.

Any optimistic guidance would be welcomed enthusiastically by markets, as it has been a really long time since companies have pointed toward better times ahead.

With corporate earnings less buoyed by buybacks, sooner or later investors are going to demand earnings that are actually real earnings and those investors are very likely to reward real earnings improvements.

You would think that if the FOMC projects that the economy should be able to warrant a small increase in interest rates that there would be some good corporate earnings news ahead, as well.

But that still remains to be seen and I think that may still be another quarter into the future before companies start going out on a limb and say that the future looks better.


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Daily Market Update – September 27, 2016

 

 

Daily Market Update – September 27, 2016 (7:30 AM)


Markets look as if they’re going to open on the calm side this morning after posting two consecutive triple digit losses for the first time since the Brexit vote.

There wasn’t much of a reason for either of the past two declining days, just as there’s not too much reason for any significant moves for the rest of the week, except perhaps Friday.

That’s when the GDP is released and a surprising number could really move markets that are now expecting that there will be an interest rate increase in December. That would probably require some positive economic news and the GDP is a good place to start, especially if there are some upward revisions.

In the meantime, there are still lots of Federal reserve members set to speak this week and any of them has the power to move markets, even if only for a few hours until a counter-position is voiced.

With a purchase of shares yesterday that happened to be ex-dividend today, I don’t expect to be spending much more money this week, unless it looks as if I will be able to realize some new cash from those positions whose short option contracts expire this week.

There’s little reason to expect any sustained move higher while we await December, but with earnings about to start again in 2 weeks, it will be interesting to see whether or not companies are seeing anything hopeful ahead.

Any optimistic guidance would be welcomed enthusiastically by markets, as it has been a really long time since companies have pointed toward better times ahead.

With corporate earnings less buoyed by buybacks, sooner or later investors are going to demand earnings that are actually real earnings and those investors are very likely to reward real earnings improvements.

You would think that if the FOMC projects that the economy should be able to warrant a small increase in interest rates that there would be some good corporate earnings news ahead, as well.

But that still remains to be seen and I think that may still be another quarter into the future before companies start going out on a limb and say that the future looks better.


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Daily Market Update – September 26, 2016 (Close)

 

 

Daily Market Update – September 26, 2016 (Close)


There really isn’t very much happening this week.

Earnings are just about over and the FOMC Statement has now been released.

What we do have is the release of the GDP on Friday and that may offer the first bit of proof that perhaps an interest rate increase may be warranted.

But what we really have this week are 12 speeches by voting and non-voting members of the FOMC.

Each of those will believe that he or she holds proprietary rights to the truth, but the real truth is that only the final speaker, Janet Yellen, will matter.

The further truth, though, is that she may matter a little bit less, as everyone is just getting more vocal and of their own minds,

With 6 of the speeches coming from voting members and the majority of those coming from interest rate hawks, it may be an interesting week of back and forths as the speakers jockey for their spot in the sun.

Today, however, what really weighed upon markets were foreign banks, specifically news that Deutsche Bank may not be in line to get any help from the German government in the event that it is short on capital. That weighed heavily on our own banking stocks and it is hard for US markets to move ahead if the financial sector isn’t feeling up to it.

That explains some of what we saw today, as the market closed on its lows, never really making any sincere effort to do anything better than a triple digit loss.

I have a couple of ex-dividend positions this week and a couple of expiring positions and cash in my pocket.

I didn’t feel a great sense of urgency to spend any of that money, but I knew that i could easily get pulled in.

And I did, but mostly for more dividend.

At the moment, my hope is that the expiring positions end up adding to my cash reserve and making up for the decision to actually spend some money today.

I wouldn’t mind a little bit more of a sell-off this week, as long as those 2 positions can still continue to do something worthwhile.

Both were hit in today’s sell off, but not to the degree that the market was hit, so we’re still in the running for something.

I don’t expect to be doing much of anything this week other than watching the markets possibly gyrate as we wonder when the 0.25% hammer will finally come down on us.

0.25%.

That’s what potential panic is all based upon.

How strange this market continues to be.


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Daily Market Update – September 26, 2016

 

 

Daily Market Update – September 26, 2016 (8:30 AM)


There really isn’t very much happening this week.

Earnings are just about over and the FOMC Statement has now been released.

What we do have is the release of the GDP on Friday and that may offer the first bit of proof that perhaps an interest rate increase may be warranted.

But what we really have this week are 12 speeches by voting and non-voting members of the FOMC.

Each of those will believe that he or she holds proprietary rights to the truth, but the real truth is that only the final speaker, Janet Yellen, will matter.

The further truth, though, is that she may matter a little bit less, as everyone is just getting more vocal and of their own minds,

With 6 of the speeches coming from voting members and the majority of those coming from interest rate hawks, it may be an interesting week of back and forths as the speakers jockey for their spot in the sun.

I have a couple of ex-dividend positions this week and a couple of expiring positions and cash in my pocket.

I don’t feel a great sense of urgency to spend any of that money, but I could easily get pulled in.

At the moment, my hope is that the expiring positions end up adding to my cash reserve.

I wouldn’t mind a little bit of a sell-off this week, as long as those 2 positions can still continue to do something worthwhile.

I don’t expect to be doing much of anything this week other than watching the markets possibly gyrate as we wonder when the 0.25% hammer will finally come down on us.

0.25%.

That’s what potential panic is all based upon.

How strange this market continues to be.


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Dashboard – September 26 – 30, 2016

 

 

 

 

 

SELECTIONS

MONDAY:   Lots of Federal reserve talking going on this week and a GDP release, which could offer the first really strong justification for the expected interest rate hike

TUESDAY:   Markets look to be calm to start the morning after two consecutive triple digit losses for the first time in 3 months

WEDNESDAY: Big down day to start the week and a big up day to follow. That made it 3 big days in a row. Today may be the breather, but we still have GDP on Friday to possibly shake things up again

THURSDAY:  Busy, busy day today. No less than 6 Federal reserve speakers today, including Janet Yellen and the GDP, following the fourth consecutive triple digit move. This morning, though, is completely flat, as oil ruled yesterday after not doing so the previous day

FRIDAY:. Lots of ups and downs this week as oil has suddenly taken center stage again as talk about interest rates seems to have waned.


 

 



 

                                                                                                                                           

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 “SNEAK PEEK AT NEXT WEEK” APPEARS ON FRIDAYS

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Weekly Summary

  

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