April 24, 2017

Archives for November 2008

Thanksgiving seasonality

Well, it looks like the first half of the historically seasonal bullishness that surrounds Thanksgiving held true. Now, with the major market benchmarks nearing a short-term overbought state will we see the second half of the historical tendency live up to its billing? Read my post from yesterday for more info about the seasonal conditions that surround Thanksgiving. The tech-heavy Nasdaq 100 (QQQQ) moved slightly above a strong area of overhead resistance. The S&P has also moved above the 850 area (currently 882). The 850 area should act as a strong area of support if and when we head back towards that level. Anyway, I will most likely not have a post on Friday with only a half day left (and basically no volume) for the market … [Read more...]

Thanksgiving Day Seasonality

Yes, I know. I was supposed to have a second post last night about the seasonality that surrounds Thanksgiving. I do apologize, but after shoveling the heavy snow last night all I wanted to do was sleep. So I decided to do just that - sleep. Before I get to Turkey Day seasonality I would like to discuss the price action in the market today. The S&P continues to flirt with the 850 level as it hovered around it for the majority of the trading day. Could we preparing for a substantial move upward. Well, while many bulls would like to see that (and I do think we could witness another sharp rally before the end of the year) our indicators are firmly in an neutral state. As I stated yesterday my shortest-term overbought/oversold indicators … [Read more...]

S&P 500 advances to test 850

Back to a neutral state and back to the closely watched 850 area in the S&P 500. While the shortest-term measures are nearing overbought as you can see in the overbought/oversold readings below all of the ETFs I follow are firmly in a neutral state. What does this mean over the short-term? It means that the likelihood of a short-term reprieve looks likely (1-3 days). However, I am not necessarily counting out the sustainability of this rally as we head into Thanksgiving. If this is indeed the beginning of a move that is more intermediate-term then a continued to push over the next few days should be seen. As I said before, the 850 level of the S&P is a critical area and it should be very interesting how the market reacts over the … [Read more...]

Overbought-Oversold Readings

Here are the numbers. I will have more information available in the upcoming Options Expiration Report. Stay tuned and don't forget to check your email. Have a great weekend! Andy Overbought-Oversold levels for November 21, 2008 ETF Extremes Options Trading Strategy * S&P 500 (SPY) - 21.3 (oversold) * Dow Jones (DIA) - 42.4 (neutral) * Russell 2000 (IWM) - 31.7 (neutral) * NASDAQ 100 (QQQQ) - 32.6 (neutral) Sector ETF Extremes Options Strategy * Biotech (IBB) - 20.5(oversold) * Consumer Discretionary (XLY) - 37.1 (neutral) * Health Care (XLV) - 22.3 (oversold) * Financial (XLF) - 19.3 (very oversold) * Energy (XLE) - 44.8 (neutral) * Industrial (XLI) - 31.3 (neutral) * Materials (XLB) - 23.2 (oversold) * … [Read more...]

Patience Continues to Pay While Greed Continues to Kill

As much as my  gut feels that the market will experience a near-term rally I am glad I haven't acted on it in our options strategies. I have been patiently waiting on the sidelines (as I always do) for the my signals to trigger a warranted trade and so far this has worked over the short, intermediate and long-term, particularly in the ETF Extremes strategy. Just by sitting on the sidelines I continue to outperform the market by a substantial margin. The important thing to point out that I did not come to this conclusion recently. The strategies did not blow up in the face of the bear market. Actually, the ETF Extremes has gained considerable ground over the past year (and since its inception three years ago for that matter). Greed … [Read more...]

Oversold to Very Oversold – Ready for a short-term bounce?

Another trend day lower. Well, the 850 level on the S&P was taken out early in the trading day and as result the ES (S&P futures) moved swiftly lower throughout the day to finally close at 811. The decline has pushed the major market benchmark back into a short-term oversold state. Moreover, it has pushed the tech-heavy Nasdaq 100 (QQQQ) back into a short-term "very oversold" state. Depending on how the market reacts at the open we could see a few trades in both of our Extremes strategies. There are a plethora of oversold to very oversold readings in the sectors so I will try and sift through a few tonight to see where the best opportunities are for a short-term trade. Of course, that is if a trade does indeed occur. The … [Read more...]

850 continues to hold on the S&P

850 continues to hold on the S&P or $83.58 as seen on the SPY chart. I continue (for all the reasons given on yesterdays post) to believe we are headed higher over the short to intermediate-term. Yesterday's post pretty much sums up my current sentiment so I really do not have much to say today. I am currently watching the Nasdaq 100 (QQQQ) and XLF for potential short-term trades in our two extreme strategies. Subscribers, as always, I will send out a real-time trade alert if and when a trade occurs. Until then, have a great night! Andy Overbought-Oversold levels for November 18, 2008 ETF Extremes Options Trading Strategy * S&P 500 (SPY) - 41.2 (neutral) * Dow Jones (DIA) - 41.9 (neutral) * Russell 2000 (IWM) - … [Read more...]

Options Expiration begins in Lackluster Fashion

The week of options expiration started in a lackluster fashion. After trading lower at the open the market moved slightly into positive territory only to give the gains back during the final hour of trading. The move today put the tech-heavy Nasdaq 100 (QQQQ) back into an oversold state and once again close to another signal in our ETF Extremes strategy. On a seasonal nasis the week of options expiration during the month of November has averaged a gain of 1.2% since 1995.  Eleven of the last 13 years have finished the week in the black. Furthermore, according to Jason Goepfert of Sentimentrader there have been 10 occasions when the S&P have closed Friday by 2% or lower and then proceeded to decline by an additional -0.5% the … [Read more...]

Overbought/Oversold Readings

Here are the overbought/oversold numbers as we head into the weekend. Next week brings options expiration and I think we could in store for a doozy. Anyway, I will save my commentary for the Weekend Report due out Sunday.  Until then, have a wonderful weekend. Life is good! Andy Overbought-Oversold levels for November 14, 2008 ETF Extremes Options Trading Strategy * S&P 500 (SPY) - 36.6 (neutral) * Dow Jones (DIA) - 38.7 (neutral) * Russell 2000 (IWM) - 34.6 (neutral) * NASDAQ 100 (QQQQ) - 31.6 (neutral) Sector ETF Extremes Options Strategy * Biotech (IBB) - 45.2 (neutral) * Consumer Discretionary (XLY) - 41.2 (neutral) * Health Care (XLV) - 35.9 (neutral) * Financial (XLF) - 34.1 (neutral) * Energy (XLE) - … [Read more...]

Classic Washout – Where Now?

Could today be the intermediate-term low that we have all been seeking? It certainly felt like a day of capitulation. One thing is certain, what we did get was a fake breakdown. The futures pointed towards a breach of the October lows and after a brief rally (if you can call it that) the bears took control and moved the market decisively lower. The move lower lasted until around 1pm EST (after almost all stops were taken out, convenient eh?) and then quickly rallied to close near the highs of the day and the buying demand was legitimate as we moved past several important areas of overhead resistance. The question is now, will this rally continue? If you have been reading my blog recently you certainly know my opinion. All of the … [Read more...]