Category Archives: Daily Market Update

Daily Market Update – September 14, 2016 (7:30 AM)

Yesterday wasted Monday’s great recovery, as investors once again showed just how much they don’t like the idea of an interest rate hike next week.

There was nothing redeeming about yesterday’s trading and there was really no news to have supported the kind of reaction the market had.

We’re now in the quiet period one week ahead of the FOMC meeting, where members seem divided as does opinion.

While everyone is focused on deciding whether the interest rate hike will come in September or December, what is forgotten is that the FOMC has said that such an increase could come at a time other than a regularly scheduled meeting.

That would really take people by surprise, but it would get us over this really insignificant decision by the FOMC, at least as far as investing goes.

A 0.25% increase in rates isn’t likely to divert too much money away into some other kind of investment, as offering a better reward for risk.

Meanwhile, an increasing interest rate environment would reflect a growing economy and stock prices are traditionally based on earnings, so that can’t be a bad thing.

With a number of positions expiring this week, I hope that there’s some rebound over the next few days so that those positions can be in play for either rollover or assignment.

Either would suit me just fine at this point.

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Daily Market Update – September 13, 2016 (Close)

Yesterday had a very impressive recovery from what was looking as if it was going to be a big opening plunge for the markets.

With 3 Federal reserve Governors speaking, the market improved with each, as there was an increasingly dovish tone, particularly with the final pronouncement.

That came from someone who doesn’t take center stage very often and her dovish words really sent the market much, much higher.

Obviously, the market’s reaction is similar to those who like the idea of nuclear power plants, but not in their backyard.

The market has said that it likes the idea of a small interest rate increase, but now right now, please.

This morning’s futures were again pointing much lower, but there is now a blackout period for the Federal Reserve members and despite yesterday’s hero reinforcing her beliefs today, the market wasn’t buying it or anything else today.

Now, Federal reserve Governors and Presidents can’t say anything in public until after next Wednesday’s FOMC meeting.

Today was another sell off on interest rate fears and it brought us right back to where Friday had left us.

I did make one trade yesterday, going back to that old friend Marathon Oil, but oil continued its deep slide today.

The energy sector, like stocks, had a nice reversal yesterday, but it didn’t last very long, as it started that way as soon as eyes were being opened and it never got any better, unlike yesterday.

I still hold out some hope for selling calls on uncovered positions, but my real hope for the week is to have some assignments and some rollovers.

I’d love the idea of adding to cash reserves right now, just as I like the idea of generating some more revenue to go along with all of this week’s ex-dividend positions.

My guess was that today wouldn’t be the day to do much of anything.

Being right about that brings no solace, though.

And like last week, I wonder if there will be much opportunity for the rest of this week, as everyone will be focused on the following week’s FOMC.

Including me, I think.

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Daily Market Update – September 13, 2016 (8:30 AM)

Yesterday had a very impressive recovery from what was looking as if it was going to be a big opening plunge for the markets.

With 3 Federal reserve Governors speaking, the market improved with each, as there was an increasingly dovish tone, particularly with the final pronouncement.

That came from someone who doesn’t take center stage very often and her dovish words really sent the market much, much higher.

Obviously, the market’s reaction is similar to those who like the idea of nuclear power plants, but not in their backyard.

The market has said that it liokes the idea of a small interest rate increase, but now right now, please.

This morning’s futures are again pointing much lower, but there is now a blackout period for the Federal Reserve members.

They can’t say anything in public until after next Wednesday’s FOMC meeting.

I did make one trade yesterday, going back to that old friend Marathon Oil.

The energy sector, like stocks, had a nice reversal yesterday.

They’ll need the same thing today, because the futures has them down sharply, as well.

I still hold out some hope for selling calls on uncovered positions, but my real hope for the week is to have some assignments and some rollovers.

I’d love the idea of adding to cash reserves right now, just as I like the idea of generating some more revenue to go along with all of this week’s ex-dividend positions.

My guess is that today won’t be the day to do much of anything.

And like last week, I wonder if there will be much opportunity for the rest of this week, as everyone will be focused on the following week’s FOMC.

Including me, I think.

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Daily Market Update – September 12, 2016 (Close)

The close to last week’s trading came as a surprise to everyone except those who have the uncanny ability to look backward.

Since market moves are really driven by professional traders, it appears that the only people who saw Friday’s nearly 400 point decline coming were those who were casual traders and they were able to leave the losses to the pros.

I certainly didn’t see any reason for the decline to come on Friday.

In fact, it’s hard to say that there’s any good reason for the market to make a strong statement in either direction, particularly as the last few years have shown that fundamentals aren’t very important.

It’s all been about investor psychology and at the moment there’s really no clue as to how the market would behave when an interest rate increase becomes reality.

e know how it reacts when it feels as if one is right around the corner, though.

The latest thinking is that despite seeming to accept such an increase, the market feels much more comfortable with it coming in December, rather than next week.

I suppose that would give everyone a few months of cheap money to get their houses in order.

I suppose.

Today, then, served to show just how much unease there is, as the futures were sharply lower today and then came the talking head Federal Reserve Governors.

With lots of ex-dividend positions last week and some rollover activity, in addition to a new trade, I had more to keep me interested than I thought would be the case.

This week, there are also a lot of ex-dividend positions, but also a fair number in need of rollover, as the monthly cycle comes to its end.

As I look at the number expiring, it’s still far less than I would have expected at a monthly expiration in any of the past 5 years, but still enough to offer some opportunities to trade.

Increasingly, there has been reason to look at some longer term expirations, even as volatility has remained so low.

Friday’s plunge and this morning’s weak opening do increase volatility, but there’s quite a ways to go until that level even returns to its historical lows.

With some money to spend this week, I wouldn’t mind doing so, but am going to remain cautious.

Some of the price plunges on Friday and perhaps some more today may make it more difficult to resist, but with the big unknown coming from next week’s FOMC meeting, it may just be best to remain tight fisted.

Then, returning back to those three Federal Reserve Governors speaking today, they did just what was expected of them.

They alternated between adding fuel to the fire and uttering a soothing word or two.

The way the market reversed itself and erased more than 50% of Friday’s nearly 400 point decline when the dove spoke, gives you some indication of how much this market doesn’t want a rate increase now.

Otherwise, it still appears as if the whole world may be a little nervous about central banks becoming less accommodative and cheap money disappearing.

It’s hard to know whether that’s the tale wagging the dog or the other way around, but the next 10 days wi
ll be interesting.

Today certainly was an interesting one, but with a black out period beginning tomorrow for those Federal Reserve Governors, we’ll just have to find something else to get us into a frenzy.

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Daily Market Update – September 12, 2016 (8:30 AM)

The close to last week’s trading came as a surprise to everyone except those who have the uncanny ability to look backward.

Since market moves are really driven by professional traders, it appears that the only people who saw Friday’s nearly 400 point decline coming were those who were casual traders and they were able to leave the losses to the pros.

I certainly didn’t see any reason for the decline to come on Friday.

In fact, it’s hard to say that there’s any good reason for the market to make a strong statement in either direction, particularly as the last few years have shown that fundamentals aren’t very important.

It’s all been about investor psychology and at the moment there’s really no clue as to how the market would behave when an interest rate increase becomes reality.

The latest thinking is that despite seeming to accept such an increase, the market feels much more comfortable with it coming in December, rather than next week.

I suppose that would give everyone a few months of cheap money to get their houses in order.

I suppose.

With lots of ex-dividend positions last week and some rollover activity, in addition to a new trade, I had more to keep me interested than I thought would be the case.

This week, there are also a lot of ex-dividend positions, but also a fair number in need of rollover, as the monthly cycle comes to its end.

As I look at the number expiring, it’s still far less than I would have expected at a monthly expiration in any of the past 5 years, but still enough to offer some opportunities to trade.

Increasingly, there has been reason to look at some longer term expirations, even as volatility has remained so low.

Friday’s plunge and this morning’s weak opening do increase volatility, but there’s quite a ways to go until that level even returns to its historical lows.

With some money to spend this week, I wouldn’t mind doing so, but am going to remain cautious.

Some of the price plunges on Friday and perhaps some more today may make it more difficult to resist, but with the big unknown coming from next week’s FOMC meeting, it may just be best to remain tight fisted.

There are also three Federal Reserve GOvernors speaking today, so there will either be fuel added to the fire or perhaps a soothing word or two.

Otherwise, it appears as if the whole world may be a little nervous about central banks becoming less accommodative and cheap money disappearing.

It’s hard to know whether that’s the tale wagging the dog or the other way around, but the next 10 days will be interesting.

.