Author Archives: TheAcsMan

Daily Market Update –  December 1, 2016 (Close)

It’s December and we are sitting right at all time highs.

OK, maybe the S&P 500 wasn’t paying attention today, but how about that DJIA?

If your portfolio has energy and commodities in it, you are doing far better than anyone else, although if you had them last year, as I did, you would have said close to the opposite.

Put it all together, year building upon year, and some of those things work out, especially if there are little cushions like option premiums and dividends along the way.

Those make it easier to wait out what we all know are cycles.

What we never know is when a cycle begins nor ends, nor do we ever know its length.

Who, in the face of a worldwide economy that wasn’t really shrinking, ever believe that energy prices would go so low and then stay so low for so long?

But that’s what it is as we are now again faced with oil above $50.

We again will see whether it can stabilize above that level or whether increased supply will push price lower again.

What may be different this time is that the market has reason to go up or down on its own merits and not solely on the price of oil, as it had dome through so much of the past year.

As December comes around and the year comes to its end, we just have to watch and see what the FOMC does, but probably more importantly what will be said in its statement and what kind of things are said at the subsequent Chairman’s press conference.

After that, it’s just a case of waiting to see if corporate profits do follow the path that it looks as if they may finally take and whether or not our new President can move his agenda forward.

I for one, am looking forward to 2017, despite a very satisfying 2016 in the market.

The countdown begins today and maybe tomorrow brings us a taste of what the rest of 2016 may hold.

.

Daily Market Update –  December 1, 2016 (7:30 AM)

It’s December and we are sitting right at all time highs.

If your portfolio has energy and commodities in it, you are doing far better than anyone else, although if you had them last year, as I did, you would have said close to the opposite.

Put it all together, year building upon year, and some of those things work out, especially if there are little cushions like option premiums and dividends along the way.

Those make it easier to wait out what we all know are cycles.

What we never know is when a cycle begins nor ends, nor do we ever know its length.

Who, in the face of a worldwide economy that wasn’t really shrinking, ever believe that energy prices would go so low and then stay so low for so long?

But that’s what it is as we are now again faced with oil above $50.

We again will see whether it can stabilize above that level or whether increased supply will push price lower again.

What may be different this time is that the market has reason to go up or down on its own merits and not solely on the price of oil, as it had dome through so much of the past year.

As December comes around and the year comes to its end, we just have to watch and see what the FOMC does, but probably more importantly what will be said in its statement and what kind of things are said at the subsequent Chairman’s press conference.

After that, it’s just a case of waiting to see if corporate profits do follow the path that it looks as if they may finally take and whether or not our new President can move his agenda forward.

I for one, am looking forward to 2017, despite a very satisfying 2016 in the market.

The countdown begins today.

.

Daily Market Update –  November 30, 2016 (Close)

This week not too much seemed to be happening, although the futures were pointing mildly higher in the morning.

That was happening as oil was surging, following a few days of sharp declines.

The backdrop to all of that was today’s OPEC meeting, as there was a volley of thought about whether OPEC will still be able to come to any kind of agreement that won’t find its various members cheating.

This morning, the belief was that OPEC would find a way to at least announce a production cut and energy prices were very sharply higher.

What made today really different was that at no pint in the day did the POEC agreement fall apart.

I think that it’s a good sign that the stock market futures weren’t following oil higher as they would have done just weeks ago.

It’s also a good sign that the stock market isn’t heading in the other direction as a response.

The reality is that whatever cuts OPEC implements that may result in an increase in end user price will quickly be met by non-OPEC member nations, such as the United States.

With a couple of new purchases this week and a rare DOH trade, my sights are now set on expiration Friday, which could still be a big mover, as our expectations are for good news from the Employment Situation Report.

From that perspective, all eyes are now on the FOMC meeting 2 weeks from today, with an expectation of a small interest rate increase.

Short of some huge surprise, there shouldn’t be much interest rate fear baked into pricing, so there’s not too much reason to expect any large moves in the next 2 weeks, although, this could be a “react on the news” sort of thing, even as it is so widely expected.

I’m fine with just sitting back and watching net asset value grow and taking whatever trade opportunities might come along, even if jumping the gun on rollovers.

.

Daily Market Update –  November 30, 2016 (8:00 AM)

This week not too much seems to be happening, although the futures are pointing mildly higher in the morning.

That’s happening as oil is surging, following a few days of sharp declines.

The backdrop to all of that is today’s OPEC meeting, as there is a volley of thought about whether OPEC will be able to come to any kind of agreement that won’t find its various members cheating.

This morning, the belief is that OPEC will find a way to at least announce a production cut and energy prices are very sharply higher.

I think that it’s a good sign that the stock market futures aren’t following oil higher as they would have done just weeks ago.

It’s also a good sign that the stock market isn’t heading in the other direction as a response.

The reality is that whatever cuts OPEC implements that may result in an increase in end user price will quickly be met by non-OPEC member nations, such as the United States.

With a couple of new purchases this week and a rare DOH trade, my sights are now set on expiration Friday, which could still be a big mover, as our expectations are for good news from the Employment Situation Report.

From that perspective, all eyes are now on the FOMC meeting 2 weeks from today, with an expectation of a small interest rate increase.

Short of some huge surprise, there shouldn’t be much interest rate fear baked into pricing, so there’s not too much reason to expect any large moves in the next 2 weeks, although, this could be a “react on the news” sort of thing, even as it is so widely expected.

I’m fine with just sitting back and watching net asset value grow and taking whatever trade opportunities might come along, even if jumping the gun on rollovers.

.

Daily Market Update –  November 29, 2016 (Close)

As the week is getting off to its start, it may look as if this may be a quiet week.

There are, however, a few things that were ahead this week that could have changed the breather from what is being called “The Trump Rally.”

That was the release of today’s GDP and then Friday’s Employment Situation reports.

There’s also the matter of that OPEC meeting that sent oil prices higher, once again in speculation that greedy partners could agree on anything, as we saw again today, may be an over-estimation of their abilities as a cartel.

Most recently, going back to about May, there have been a series of run ups in oil price predicated on that kind of agreement, only to be given back as greed won out.

Where that matters is that for much of 2016 oil and stocks have been closely linked.

At some point, though, maybe now, there will be the realization that in the face of an expanding economy the low price of oil is just great.

That should mean great for stocks, too, as the input price of energy has to be factored into just about every company’s profit and loss statement.

Today’s sharp decline in oil probably held the market back, but not as much as it would have a month or more ago. Maybe it was the revised GDP, now pointing to a 3.2% growth rate, that allowed the market to finish slightly higher,

After yesterday’s unexpectedly busy day of trading, I don’t expect to be doing much else for the rest of the week, other than looking for opportunities to roll over those 3 positions expiring this week and perhaps find some additional call sale opportunities or early rollover candidates.

In the meantime, I’ll just keep an eye on the news and events, as usual, content with this week’s income and wondering why all of 2016 couldn’t have been as busy as this Monday was.

In fact, it’s been more than a year since a typical Monday of trading has occurred, at least on a regular basis.

I don’t expect that will return anytime soon, but nothing in this realm feels better than the activity of trading if coupled with income generation and capital appreciation.

Here’s to 2017.

Maybe a return to earlier times.

.