April 24, 2017

Archives for August 2008

Seasonal Tendencies – What Are They Telling Us?

Will the market experience the seasonally bullish that typically occurs on the trading day prior to the Labor Day holiday? The market has already witnessed three straight days of advances and some of my shorter-term proprietary overbought-oversold indicators have pushed near extremes, so probability says a short-term reprieve is near. However, it must be noted that over 76% of the trading days prior to the Labor Day holiday weekend have been higher with an average return of over 0.4% since 1950. One other note of interest is the fact that when the S&P 500 (SPY) has advanced two days prior to a 0.5% gap higher (like it did today), the S&P, when in a bear market, was higher approximately 23% of the time the following day. I will … [Read more...]

Sector ETF Extremes Options Strategy Nearing a Trade?

The major benchmarks  remain in a neutral state. This week has seen the lowest volume of the year and I expect it to be much the same until about Wednesday of next week. Maybe then we can see an extreme hit one of the ETFs that I follow for my options strategies. However, there could be an opportunity or two in the making in the Sector ETF Extremes Options Strategy. The Biotech sector ETF (IBB) has moved slightly in a short-term oversold state, so I will be watching how that ETF trades over the next few days. Although, the one I will be watching closely is the Utility sector ETF (XLU). It pushed higher and in to a short-term overbought state and best of all it tested and failed what seems to be an area of strong overhead resistance. … [Read more...]

More of the same – Options Strategies Patiently Wait for a Signal

Not much to say today as all of the major benchmarks and sectors I follow for my options trading strategies remain in a neutral state. My hope is that we see another sharp decline over the next two days that pushes the ETFs I follow back in an oversold state. If this occurs before the seasonal bullishness that historically occurs the day before Labor Day then we might see a signal in both of the Extreme Options Strategies. Might I add that I would not mind a gap lower over the next few days as well. It has been a while since the market has witnessed a gap lower, (or higher for that matter) and the Gap Fade Options Strategy would love an opportunity to take a position. If only Mr. Market would cooperate. Anyway, here are a few quality … [Read more...]

Patience is the Key to Options Trading (at least at CrowderOptions.com)

Just a few short snippets today and not much else. Well, the losses today wiped out the gains from late last week. I guess one encouraging statistic is that in past when the S&P declined this sharply on a Monday the return over the next three trading days was positive but only slightly. So, given the recent price action and the fact that we are in a bear market I will not hold my breath. I still think the July lows will eventually be tested and possibly breached, but that is pure speculation and more of an intermediate-term outlook. My true focus and the focus of my options strategies is to find extremes in the market. Lately the major benchmarks and the sectors I follow just want to sit in a neutral state. That is fine, extremes … [Read more...]

Pre-Market Trading Thoughts

Below are the overbought-oversold numbers from last Friday. All of the major benchmarks and sectors I follow for the options strategies we trade (other than the Utilities Sector (XLU)) remain in a neutral state. As I stated recently, over the last eleven years, seven have witnessed significant declines in the major market benchmark S&P 500 (SPY) during the final five trading days of August. The S&P has lost on average -2.6% during that short time frame. Will it occur again this year? No one knows for certain, but if we are able to hold the current overbought levels or sell-off near-term and rally back to overbought levels as we enter the seasonally weak period at the end of August I would expect to see probability win out once … [Read more...]

A Few Sectors Moving Near Extremes

Finally, a few of the sectors I follow for the Sector ETF Extremes Options Strategy have pushed near an extreme state. Our last signal was on 7/23 when we made roughly 9.8% on an XLF trade. Since then I have been waiting patiently for a set up and now another one might be coming to fruition. Real Estate (IYR) , Energy (XLE) and Utilities (XLU) are currently on my radar after today's trading session. If all goes well we will hit an extreme in one or more of those sectors over the next couple days. As for the Gap Fade optoins strategy, we came close to a trade today, but the NASDAQ 100 (QQQQ) only gapped down by $.01 and quickly closed at the open so no trade occurred. The last month has been rather stagnant for gaps in the QQQ's, but … [Read more...]

High-Beta Index Clinging to Support Level

The NASDAQ 100 (QQQQ) just can't rally off what seems to be a strong support level at $47.00. While the index is firmly in a neutral state (so there isn't a true bullish or bearish edge). We have been trading in a fairly tight range over the last two trading days so I would expect to see something give very soon. A push to the downside could trigger a few signals, but only if we can get an oversold reading. It has been quite some time since every index and sector ETF I follow for the options strategies have held in a neutral state. In the past when this type of event occurs (or should I say non-event) a sharp move typically follows.  Until then, as always, I will be patiently waiting on the sidelines for a signal to occur in one of our … [Read more...]

Options Strategies Continue to Wait for Signal

The continued sell-off today did absolutely nothing for the major benchmarks or the sector ETFs I follow for the options strategies. I am still waiting patiently on the sidelines until a short-term extreme enters the market and other than the Financial sector (XLF) not much has moved  on my radar. Of course, this could change quickly tomorrow if the decline furthers itself, but my guess is that we a short-term bounce back up to overhead resistance around the 1285 area on the S&P. My guess is that we will eventually test the July 15th low once again, but that it pure speculation. One thing is for certain a  move below the 1250 area, which is an area of strong support, should bring the bears back out to play. If we are indeed in a … [Read more...]

Late Post Tonight

I just wanted to let everyone know that the post tonight will be rather late. Server issues with our host which has made it difficult to upload anything including the August Options Expiration Report. See you soon. Andy … [Read more...]

Post Options Expiration Decline

All of the major benchmarks that we follow in our stock options strategies have moved into a neutral state. The post expiration blues once again came to fruition and now it will be a tug of war over the next few days. My guess is that we will see a push back to the upside over the next day or two, but that is pure speculation. My hope is that we can see a sharp advance as we head into the final five trading days of August which begins on Tuesday the 26th. If we do see a move into overbought or better yet 'very overbought' immediately before that time comes I would imagine that we would most likely see a trade in the ETF Extremes options strategy. As for the Sector ETF Extremes options strategy, well, every sector ETF option we follow is … [Read more...]