Feb132015

Week in Review – February 9 – 13, 2015

Week in Review

 

 

Option to Profit Week in
Review –  February 9 – 13,  2015
 
NEW POSITIONS/STO NEW STO ROLLOVERS CALLS ASSIGNED/PUTS EXPIRED CALLS EXPIRED/PUTS ASSIGNED CLOSED
2 / 3 3 3 3  /  0 0  / 0 0

    

Weekly Up to Date Performance

February 9 – 13,  2015

Finally, a week with a little of everything.

New positions trailed the unadjusted S&P 500 by 0.2% for the week and the adjusted index by 0.3%.

Despite being 1.8% higher for the week the covered positions placed a limit on their gains as the unadjusted S&P 500 finished 2.0% higher and the adjusted S&P 500 fi
nished 2.1% higher, as the S&P 500 set a new record close

Existing positions were 2.4% higher for the week, beating the broader market by 0.4% on the week, which has been the trend thus far in 2015. While it’s relatively easy to beat the broad market during a week when the market itself isn’t performing well, it’s especially nice to do so when the market has had a substantial gain.

With 3 assigned positions this week the total number for 2015 is still small as compared to previous year at the same point. Thus far the positions closed in 2015 are an average of 4.6% higher, while the comparable time adjusted S&P 500 average performance has been only 1.7% higher. That 2.9% difference represents a 164.6% performance differential that is very unlikely to be maintained through the year.

 

Most weeks, even when assets have climbed nicely I find something that I’m unhappy about.

Lately it has been related to the reduced trading activity and a dwindling cash reserve as assignments have been few and the income stream has been less than I would like to see.

This week I was pretty happy, although I would have liked to have been able to rollover Microsoft to also get its dividend next week, but that’s better than having one of those weeks sitting around and waiting for an opportunity and nothing ever gets to unfold.

The final bottom line for the week also helped to ease the dividend that got away, but the process was just better this week, as well.

This week was still a far cry from opening the number of new weekly positions as was the case through much of 2013 and 2014, but if anything is obvious, 2015 is not 2013 nor 2014.

What it may be is another 2011, as markets have been going up and down or a really regular basis and in having exerted so much energy since the beginning of the year is now back to where it ended 2014.

That represents a lot of effort for not having gone anywhere and that was precisely what 2011 was all about as the S&P 500 finished unchanged for the year, but not without lots of gyrations and large moves from day to day.

If 2015 will represent a return to that kind of a market instead of being one that simply goes higher in a straight line, then there will be far less opening of new positions and far more rollovers, instead.

The longer you’ve done this sort of thing the more those rollovers have their appeal and the more consistently those returns can accumulate even if the stock has ended up doing very little on a net basis, just as long as it puts in the effort in-between.

The rollover of the Gold Miners ETC (GDX) puts was an example of taking a position that was heading toward its end and trying to breathe additional life into it by rolling it over rather than seeing it leave the portfolio.

That’s what I had wanted to do with Microsoft and that’s the sort of thing that you can find yourself doing more and more, especially when the forward weeks premiums reflect more volatility than the expiring week’s premiums. In those cases the near week sees erosion of its premium at a faster rate than the forward week and it may make sense to do the rollover rather than take the assignment of a call or the expiration of a put.

That also hasn’t really been the case since 2011 and early 2012. It also wasn’t the case with Microsoft today.

There’s actually something nice about having an in the money position reward you with an enhanced premium and without the need for an event, such as earnings, to be necessary for that enhancement. When it does occur there’s reason to keep the position going and going.

It’s also nice to see that even if one of those in the money stocks falls it may not be as bad as it is for others. You may even find yourself rooting for a price drop to get it closer to the strike price so that you can get to play all over again.

Withh lots of positions set to expire next week and with some replenishment of the cash reserves I may be a little less miserly in adding new positions. However, with only a 4 day trading week and not really wanting to add to the number of positions set to expire on a single day, I’m likely to look beyond next week and into the March 2015 cycle when writing contracts.

That’s especially true as at the moment a number of next week’s positions are in decent position themselves to either be assigned or rolled over.

Either way, I’d be happy to see some more positions taken off the books or at least be fruitful members of the portfolio and take advantage of what I hope will continue being an up and down market

 

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

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



New Positions Opened:   ATVI, GDX (puts), MSFT

Puts Closed in order to take profits:  none

Calls Rolled over, taking profits, into the next weekly cycle:  GDX, GDX (puts)

Calls Rolled over, taking profits, into extended weekly cycle:  GPS (3/7)

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 cycle:  none

New STO:  BP (3/20), DOW (3/20), LVS (2/27)

Put contracts expired: none (some may have chosen to let GDX put expire rather than to rollover)

Put contracts rolled over: GDX

Long term call contracts sold:  none

Calls Assigned: ATVI, MET, MSFT

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: BP (2/11 $0.60)

Ex-dividend Positions Next Week: MAT (2/17 $0.38), RIG (2/18 $0.75), AZN (2/18 $1.88)

 

 

For the coming week the existing positions have lots that still require the sale of contracts:   AGQ, ANF, CHK, CLF, COH, FCX, HAL, HFC, .INTC, JCP, JOY, LVS, MAT, MCP, MOS,  NEM, RIG, SBGI, WFM, WLT (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.



Feb62015

Week in Review – February 2 – 6, 2015

Week in Review

 

 

Option to Profit Week in
Review –  February 2 – 6,  2015
 
NEW POSITIONS/STO NEW STO ROLLOVERS CALLS ASSIGNED/PUTS EXPIRED CALLS EXPIRED/PUTS ASSIGNED CLOSED
0 / 0 1 3 1  /  0 1  / 0 0

    

Weekly Up to Date Performance

February 2 – 6, 2015

For only the second time in years, there were no new positions opened this week and hardly  any other trades, either.

For purposes of comparison, it’s probably a good thing that no new positions were opened this week, as it would have been a tall order being able to match the 3.0% advance for the S&P 500.

On a positive note existing
positions were able to keep up with that advance as they were also 3.0% higher for the week, which is generally unexpected in a week that the market itself was so strong.

There was only a single assigned position this week and thus far the positions closed in 2015 are 4.9% higher, while the comparable time adjusted S&P 500 performance was 1.4% higher. That 3.5% difference represents a 247.4% performance differential that is very unlikely to be maintained through the year.

 

Up until Friday’s close, this week was virtually a mirror image of last week.

If you ever believed that the image in the mirror looked better than the original, you would certainly believe that was the case this week.

While last week, and for the most part 2015, has been made a little more palatable by virtue of out-performing the S&P 500, it’s far better to have more money at the end of the week to show for your efforts than it is to have bragging rights.

While I enjoy making trades and am not particularly thrilled when sitting around doing nothing, the color green makes doing nothing acceptable as long as it can last and not devolve into shades of red.

This was only the second time in years that there were no new positions opened during the week. The previous time, though, was only 3 months ago.

Partially, the reason for not plunging in and picking up new positions was the size of cash reserves and a real desire to add to the pile, rather than deplete it.

But with the week opening on a strong note and then doing so for a second consecutive day, it’s hard to want to get in when the predominant move has already been higher. Additionally, with so few positions set to expire this Friday, the idea of making new purchases on Wednesday or after would have meant either very small premiums for a weekly contract or going into the next week and further reducing the chances of assignments this week that could be used to replenish the cash pile.

As it is, it was another disappointing week as far as assignments would go.

I had been hopeful that MetLife and The Gap would join Halliburton and get assigned, especially as The Gap and MetLife have sales and earnings, respectively next week, but they, along with most of the rest of the market decided to give up mid-Friday afternoon.

Given the strong trading during the week and the comeback on Thursday from a rally killing end to Wednesday’s trading even with a little disappointment from Friday’s close, you have to be impressed with the way the market has come back from its recent losses.

Again.

The problem is that it has kept doing that over and over again since reaching market highs at the very end of December.

While some may point to that as being reflective of the market’s strength there are others who see it as being similar to the spasms seen before something undesirable happens.

I don’t have too much of an opinion on what all of these ups and downs mean, as long as the net result is only a small change. A week 3% higher after a week nearly 3% lower, coming after a week nearly 2% higher isn’t so bad as long as all of those big moves offset one another and create a feeling of uncertainty.

That feeling gets reflected in the option market and that’s good if you’re the one doing the selling.

In general, it’s not as good if you’re the one doing the buying, as you may also see when trying to close some positions or do rollovers.

Hopefully that volatility continues next week and it would be great if the market could continue an upward bias in its tone, although it would esp[ecially be nice to see the back and forths happening from day to day rather than week to week.

With a couple of rollovers this week now set to expire next week and with already enough positions set to expire the fo
llowing week as the cycle comes to an end, my preference for any new purchases next week is to look for weekly expiration opportunities.

However, I think it may be another quiet week as far as new positions go, just as there’s absolutely no clue what the market is thinking as it alternates between bull and bear and once again approaches all time highs.

The real signals may come in about 2 weeks as the major retailers start to report earnings and provide guidance. With today’s Employment Situation Report there’s  reason to believe that retail earnings may finally provide some evidence that lower energy prices and increased employment at higher wages will give a needed boost to the economy.

If today’s surge in interest rates is any indication that’s exactly what is the prevailing thought among those who live and die by those projections.

If so, then it’s up to the stock market to decide whether good news should be treated as being good news.

 

 

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

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



New Positions Opened:   none

Puts Closed in order to take profits:  none

Calls Rolled over, taking profits, into the next weekly cycle:  GPS, MET

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:  GME (3/20)

Calls Rolled Up, taking net profits into same cycle:  none

New STO:  BAC

Put contracts expired: none

Put contracts rolled over: none

Long term call contracts sold:  none

Calls Assigned: HAL

Calls Expired:  EMC

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: INTC (2/4 $0.24), MET (2/4 $0.35)

Ex-dividend Positions Next Week: BP (2/11 $0.60)

 

 

For the coming week the existing positions have lots that still require the sale of contracts:   AGQ, ANF, BP, CHK, CLF, COH, DOW, FCX, HAL, HFC, .INTC, JCP, JOY, LVS, MAT, MCP, MET, MOS,  NEM, RIG, SBGI, WFM, WLT (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.



Jan302015

Week in Review – January 26 – 30, 2015

Week in Review

 

 

Option to Profit Week in
Review –  January 26 – 30,  2015
 
NEW POSITIONS/STO NEW STO ROLLOVERS CALLS ASSIGNED/PUTS EXPIRED CALLS EXPIRED/PUTS ASSIGNED CLOSED
2 / 2 0 6 0  /  0 1  / 0 1

    

Weekly Up to Date Performance

January 26 – 30, 2015

After a respite from decidedly negative weeks last week, we were back to the 2015 new normal this week.

The two new positions opened this week, which were the same as opened the week before, badly trailed even a very weak market as technology and interest rate sensitive stocks were pariahs, even though that was pretty much the case for all sectors.

Those new positions ended the week 4.3% lower. Despite the overall market being 2.7% lower, they still trailed by 1.6% on both adjusted and unadjusted bases.

However, as was the case for all of the weeks in January except for last week in which the market rose, existing positions again outperformed the market by 1.4%, but were still 1.4% lower for the week.

That’s a small consolation, but is one of the things that you’re supposed to see. That is, in a down market, the losses aren’t as great, just as in an up market the gains may not be as great.

With one closed position for the week, thus far the positions closed in 2015 were 4.5% higher, while the comparable time adjusted S&P 500 performance was 1.9% higher. That 2.5% difference represents a 135.3% performance differential that is very unlikely to be maintained through the year and is skewed by having closed some longer term positions, such as LuLuLemon and Blackstone.

 

If you were among those waiting for the fabled “January Effect” that many of us were brought up on believing was sacrosanct, you can wait another year, as this January was like those of the recent past few years and did little to provide a sense of optimism going forward.

What this January did present was a glimpse of what volatility is like, especially if looking at market moves since hitting its highs at the very end of 2014.

Since that time we have had a quadruple bottom. There have been lots of days with gap up and gap down moves and lots of days with large intra-day reversals.

The preponderance of those moves has been to bring the market about 4% lower, despite the substantial trimming of losses late in the day on Friday.

Oh wait.

That substantial trimming of losses was itself reversed in the final hour of trading.

But that volatility isn’t being restricted to the stock market. Treasuries, precious metals and currencies are all bouncing around all over the place.

You can add oil into that mix, as well, as it was a strong move higher late in the day on Friday, for no yet known reason that took the market on its reverse course, as it had been propped up earlier in the day only through the performance of Visa in the DJIA, which is a uniquely weighted index such that a given percentage move in a high priced stock like VIsa has a greater impact on the index than an identical percentage move in something priced much lower, such as General Electric.

In fact, a 4% rise in shares of Visa would add about 65 points to the DJIA, while the same percentage move in GE would add only 6 points, despite GE having a market capitalization that is almost 70% greater than that of Visa.

Go figure.

But as bad as the DJIA looked today, it would have been much worse without Visa today, but even with its help the DJIA lagged the S&P 500 as the latter is more heavily weighted by energy stocks, which did well in the final 90 minutes of trading.

Just not well enough.

This was a week that I was optimistic enough to think that all of the positions set to expire on Friday had a chance of being assigned.

How quickly that changed.

Luckily, there were opportunities to get some rollovers done and to close out the Blackstone position, as there was little to be gained by hanging around for its earnings report and waiting another 3 weeks for expiration.

On the positive side closing out the Blackstone position added some money to cash reserves, but on the negative side, that was it for the week.

With cash reserves very low I don’t anticipate much in the way of opening new positions next week, although lately there haven’t been many more than two or three new positions, anyway.

With some positions set to expire next week, if any new positions are opened they will be done trying to gauge the likelihood of seeing those existing positions get assigned. If they look as if they could get assigned then I would probably try to open new positions and sell expanded weekly options on them, expiring February 13, rather than next Friday.

However, if those positions look out of reach I would likely consider selling weekly contracts on any new positions.

Again, as last week, I’d love to be able to sell some new call contracts on existing positions but hope that I have better luck with that this coming week than was the case this past week.

Hopefully, with the psychological performance pressure of January now a thing of the past, February will be able to get on with just being a normal month, but it would be great to see this volatility continue, as long as the net result wasn’t the same as in January.

 

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

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



New Positions Opened:   INTC, MET

Puts Closed in order to take profits:  none

Calls Rolled over, taking profits, into the next weekly cycle:  GDX ($20), GPS, HAL

Calls Rolled over, taking profits, into extended weekly cycle:  GDX ($20)

Calls Rolled over, taking profits, into the monthly cycle: MET

Calls Rolled Over, taking profits, into a future monthly cycle:  GDX (March 2015, $22.50)

Calls Rolled Up, taking net profits into same cycle:  none

New STO:  none

Put contracts expired: none

Put contracts rolled over: none

Long term call contracts sold:  none

Calls Assigned: none

Calls Expired:  INTC, MET

Puts Assigned:  none

Stock positions Closed to take profits:  BX

Stock positions Closed to take losses: none

Calls Closed to Take Profits: none

Ex-dividend Positions: FAST (1/28 $0.28)

Ex-dividend Positions Next Week: INTC (2/4 $0.22), MET (2/4 $0.35)

 

 

For the coming week the existing positions have lots that still require the sale of contracts:   AGQ, ANF, BAC, BP, CHK, CLF, COH, DOW, FCX, HAL, HFC, .INTC, JCP, JOY, LVS, MAT, MCP, MOS,  NEM, RIG, SBGI, WFM, WLT (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.



Jan232015

Week in Review – January 19 – 23, 2015

Week in Review

 

 

Option to Profit Week in
Review –  January 19 – 23,  2015
 
NEW POSITIONS/STO NEW STO ROLLOVERS CALLS ASSIGNED/PUTS EXPIRED CALLS EXPIRED/PUTS ASSIGNED CLOSED
3 / 3 2 3 2  /  0 1  / 0 0

    

Weekly Up to Date Performance

January 19 – 23, 2015

After a fairly miserable beginning to 2015 we were due for something good sooner or later.

With 3 new positions added this week, all within about the first hour of the week’s opening bell, those positions ended the week 1.4% higher. However, that wasn’t enough to beat the S&P 500 which was 1.6% higher for the week on both adjusted and unadjusted bases.

After 3 successive down weeks, yet existing positions nicely outperforming the market, this week there was some catch up, as existing positions were still 1.2% higher, but trailed the market’s performance by 0.4%, as can usually be expected when markets are strongly higher.

Two of the new positions for the week were assigned with closed positions for 2015  3.8% higher, as compared to the 2.2% advance for the time adjusted market, representing a 76.2% difference

 

While the big news for the week was the ECB finally embracing Quantitative Easing, despite the likelihood that their doing so won’t have any positive impact on the US markets, we acted as if it would, at least for a very short period of time.

I’m not complaining, as I like anything that sends portfolio values higher, but the lack of follow through to end the week, especially a week that was generally positive even before the announcement, was a little disappointing.

However, on a positive note, we’re far better off depending on ourselves for markets to advance as opposed to depending on the ECB.

Instead of being the unlikely beneficiaries of ECB injection of liquidity into their bond markets, which could scarcely drive their interest rates any lower, we are likely to begin seeing some tangible benefit of lower energy costs sooner or later and hopefully those will serve as the driver of higher stock prices to come.

Up until the final hour it looked as if all three new positions for the week would get assigned, but the interest rate sensitive MetLife succumbed to the large drop in interest rates later in the session.

While I was happy you see 2 positions get assigned, I would have been happier for all three, but would have welcomed back the chance to repurchase MetLife, and maybe even Intel or Best Buy, if they open the following week lower.

This was actually a very interesting week as the first 3 days of trading saw significant turnarounds from the pre-opening futures trading within about 30 to 60 minutes of trading and then turnarounds from the turnarounds.

As with most weeks I’m always disappointed by the number of new STO trades that are made on existing uncovered positions. While I would love to do more DOH trades, despite the greater attention they need in order to avoid assignment, the volatility, despite some transient increases, has still been too low to offer a risk – reward proposition that’s worth taking looking at.

As it is, I’m happy that there were some opportunities to rollover some positions and make some of those new call sales, but just like this week, next week doesn’t have very many positions set to expire on Friday.

That means that I’ll likely be looking for new positions next week with weekly option expirations, as it will be another week that I wouldn’t mind adding some new positions, even though I’d like to see cash reserves beefed up a bit more.

Next week will be the busiest week for S&P 500 company earnings and despite the fairly weak earnings so far, I think there may be some hints of good news to come as we start hearing from more consumer names and more from companies that stand to benefit from lower energy costs.

That includes some large oil companies that also begin reporting next week. If they’re able to deliver some news, as did Schlumberger and Halliburton, that wasn’t as bad as expected, that could help create some confidence going forward.

Hopefully that will be the case and I would certainly like to see another week like this one, even if it may end on a sour note.

In addition to earnings next week, while the overall week is a quiet one for economic news, it will feature both an FOMC Statement release and GDP statistics two days later.

With interest rates having been so volatile the past two weeks, both of those events net week could add to that volatility and make the week more interesting.

Not that I really yearn for things to be more interesting. Lately they’ve been interesting enough.

 

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

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



New Positions Opened:   BBY, INTC, MET

Puts Closed in order to take profits:  none

Calls Rolled over, taking profits, into the next weekly cycle:  GPS

Calls Rolled over, taking profits, into extended weekly cycle:  EMC (2/6), MET (2/6)

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 cycle:  none

New STO:  AZN (2/20), SBGI (3/20)

Put contracts expired: none

Put contracts rolled over: none

Long term call contracts sold:  none

Calls Assigned: BBY, INTC

Calls Expired:  BAC

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: none

Ex-dividend Positions Next Week: FAST (1/28 $0.28)

 

 

For the coming week the existing positions have lots that still require the sale of contracts:   AGQ, ANF, BAC, BP, CHK, CLF, COH, DOW, FCX, HAL, HFC, .JCP, JOY, LVS, MAT, MCP, MOS,  NEM, RIG, SBGI, WFM, WLT (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.



Jan162015

Week in Review – January 12 – 16, 2014

Week in Review

 

 

Option to Profit Week in
Review –  January 12 – 16,  2015
 
NEW POSITIONS/STO NEW STO ROLLOVERS CALLS ASSIGNED/PUTS EXPIRED CALLS EXPIRED/PUTS ASSIGNED CLOSED
1 / 1 0 4 2  /  0 3  / 0 0

    

Weekly Up to Date Performance

January 12 – 16, 2015

This was a fascinating week.

Only one new position was added this week and it ended the week 3.6% higher, beating the unadjusted S&P 500 by an unusually large 4.8% and the unadjusted S&P 500 by 3.8%, as the market finally moved higher on Friday, after 4 very bad days of trading and very discouraging  counter movements when occasional rally attempts were underway.

The market itself lost 1.2% on an unadjusted basis and 0.2% an unadjusted basis, adding to a recent collection of bad weeks for markets.

Just as with last week, the large discrepancy between adjusted and unadjusted S&P 500 performance is because no trades were initiated on the Mondays of those two weeks, each of which had very large downward moves. The adjusted relative performance, therefore, only measures relative performance for that period of time that money is put at risk.

However, another relative performance advantage was again seen in the existing positions, this week as they finished the week % lower, but still surpassed the S&P 500 for the week by %, again, with no real stand-outs to account for that out-performance.

Two positions were closed this week, despite another week of poor market action. So far, based on only 3 closed positions for 2015, as opposed to more than 200 for each of the past two years, those positions were 4.7% higher, as compared to the 2.4% advance for the time adjusted market. That represents a 99.1% difference and includes the long suffering shares of LiuLuLemon that were finally assigned after more than a year of holding and somehow actually managed to out-perform the S&P 500 for the period of its holding.

 

Well, this was yet another interesting week, for sure. That has now made for three of those in a row and all three have been very different, even though the end results have roughly been the same; all dragging the market lower.

At some point there may be a theme in the making. Depending on your perspective that theme in the making is either one to be nervous about or one that offers opportunities.

While I’m not necessarily nervous about all of the widespread uncertainty, I was very happy to have some positions assigned this week and would have been much happier had more gotten assigned.

It was the slowest trading week for a long time with only one new position added. Fortunately, despite the really bad trading action, there was some opportunity to get some rollovers done, but having sold some calls on uncovered positions would have been a nice touch.

To some degree, it was gratifying to again out-perform the broader market, although it’s much more meaningful if that out-performance happens to end you up with more money than less. As least this week did the former, again, in a surprisingly strong way, just like last week, although there’s not too much doubt that Friday’s close was a key factor.

What made this week especially interesting was that everything went haywire all at once.

Interest rates, currencies, stocks, precious metals and oil were all incredibly volatile.

There wasn’t anything really resembling good news this week other than the three consecutive days of oil closing higher during the final hour of trading.

The fact that oil went down so sharply and so precipitously led many to believe that the decline was fueled by speculators. If that’s the case, the climb higher may also hold some surprises.

With a 3 day weekend ahead, lots can happen in international markets to test that theory by the time we’re able to get back into the game on Tuesday morning, but what is clear is that for the past week and a half, the stock market and oil have re-coupled, after a very short time of having gone their own ways.

Whether that’s good or bad depends on your view, but if you hold lots of energy positions and are long the market, the coupling is good if the slide was artificially induced to some degree.

Friday’s final hour close was great, but most people are wary of really large climbs higher, believing that they only serve to mask bearish trends. There’s no doubt that we’ve seen a flurry of those large moves higher, but there’s also no doubt that they’ve come amidst a number of large moves lower.

So far, even with today’s unexpectedly large gain, the recent net result of all of those large moves has still been to the downside, as the S&P 500 is still almost 4% below its very recent high just a few weeks ago and we’re now in the unusual position of having witnessed a triple bottom.

It was unusual enough to have seen a double bottom, especially since for almost the past 3 years we’ve seen great regularity in the size of the declines and their spacing.

Every two months has been the formula, not every two weeks.

So does that make me nervous?

No, it makes me think that there will maybe be the chance of having some sustained volatility and we haven’t seen that since the beginning of 2012.

What also made this week interesting was a mention of good and bad volatility by bankers, who were moaning about their fixed income and currency trading losses.

The good volatility is the kind that sees lots of volleying back and forth. It’s even better if it’s on an intra-day basis. The bad kind is when you see sustained moves higher and lower.

If all of this uncertainty brings a game of volleyball back to the market, I would replace nervousness with happiness and would be very happy to be playing that game.

 

 

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

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



New Positions Opened:   FAST

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:  GDX (1/30), HAL (1/30)

Calls Rolled over, taking profits, into the monthly cycle: GME, DOW

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

Calls Rolled Up, taking net profits into same cycle:  none

New STO:  none

Put contracts expired: none

Put contracts rolled over: none

Long term call contracts sold:  none

Calls Assigned: DNKN, LULU

Calls Expired:  AZN, MAT, SBGI

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: CHK (1/13 $0.09), FCX (1/12 $0.31), WFM (1/14 $0.14)

Ex-dividend Positions Next Week:  none

 

 

For the coming week the existing positions have lots that still require the sale of contracts:   AGQ, ANF, AZN, BP, CHK, CLF, COH, DOW, FCX, HAL, HFC, .JCP, JOY, LVS, MAT, MCP, MOS,  NEM, RIG, SBGI, WFM, WLT (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.