Change Is A Comin’

I am making some big changes to the newsletter for 2009 so get ready. Subscribers will find that the changes will create much more value to their current subscriptions. I will also be offering some combo deals, plus quarterly and annual subscriptions. I will also be offering some strategy updates which I know will please many of you. Stay tuned!

I will be taking a few weeks off from blogging to spend some quality time with my family. Volume promises to be low which means market action will be highly unpredictable over the next 6 trading days. However, I would like to leave you with an interesting seasonal tendency that might just please a few of you short-term bulls.

“On a seasonal basis, next week should see exceptionally low volume with it trickling lower as the weeks comes to an end. This is typical for this time of year. The last 7 trading days of December have finished in positive territory 64 out of the last 80 years (80%) in the S&P with an average return of 1.2%. Not too shabby. The max gain was 2.0% and the max loss was -1.0.”

Have a wonderful holiday and a happy New Year! See you in 2009!

Kindest,

Andy

Get ready bulls? Hmm….

Okay, where to start?

I guess I should start by pointing out that the Health Care sector (XLV) was able to sustain a short-term overbought reading over the last two days which, well, could lead to another leg higher for the overall market, at least over the short-term. I think if and when one or both of the aforementioned sectors hits a “very overbought” state we will see another short-term decline for the overall market.

Right now my I am seeing a short-term bias to the upside particularly for the NASDAQ 100 (QQQQ). As you can see (hopefully the chart is clear) or not, I am watching the $29.00 area (more specifically $29.25) as the first area of support in the QQQQ.

If that level does not hold, well, I think we might quickly see the tech-heavy benchmark move back down to the $27 area. Just look at how the Q’s have performed around the $27 level. It looks to be a very strong area of support.

Also, I would like to point out that we have reached another inflection point- the 50-day moving average.

The two other times that that it hit this area over the past year was right before the June earnings and the September earnings, both times it failed and failed miserably. Will the pattern continue? I will have more on how the market has performed after hitting the 50-day MA for the first time in over two months. Stay tuned!

I have been stating over the past few months that I expected to see a move to the upside through the New Year with another test of the recent lows as we enter the first month or two of 2009. My guess is that it will occur sooner than later, but only time will tell.

I will have more tomorrow on this subject plus a seasonal look at the next two weeks. Get ready bulls?

Overbought-Oversold levels for December 18, 2008

ETF Extremes Options Trading Strategy

* S&P 500 (SPY) – 44.7 (neutral)
* Dow Jones (DIA) – 45.5 (neutral)
* Russell 2000 (IWM) – 60.8 (neutral)
* NASDAQ 100 (QQQQ) – 50.5 (neutral)

Sector ETF Extremes Options Strategy

* Biotech (IBB) – 70.3 (overbought)
* Consumer Discretionary (XLY) – 53.4 (neutral)
* Health Care (XLV) – 74.0 (overbought)
* Financial (XLF) – 49.9 (neutral)
* Energy (XLE) – 36.9 (neutral)
* Industrial (XLI) – 45.5 (neutral)
* Materials (XLB) – 50.9 (neutral)
* Real Estate (IYR) – 51.1 (neutral)
* Retail (RTH) – 60.4 (neutral)
* Utilities (XLU) – 49.2 (neutral)

Ultra Extremes (Insiders Page Only)

* Ultra Long (SSO) – 50.9 (neutral)
* Ultra Short (SDS) – 46.3 (neutral)

If you would like to follow my strategies with real-time alerts or have them auto-traded by a participating broker please click the following link! Try my options trading strategies.

Futures Hold 900

Well, I wanted to see the S&P futures (/ES) hold the 900 level and it did just that today. I was also hoping to see a gap up or at least a flat close, but instead the premarket blues bled into the opening bell and we witnesses a lower open. The major indexes are still hovering around an overbought state so a trade in the ETF Extremes over the next few sessions is not out of the question.

Furthermore, the Sector ETF Extremes still has a few ETFs held in a short-term overbought state today. The Health Care (XLV) and Materials (XLB) sectors currently have my attention and much like the ETF Extremes options strategy we could potentially see a trade over the next few trading sessions.

I really do not have much to say tonight. I have been blogging every day (well almost) for the last three years and I think I have hit one of those walls. It typically occurs around the holidays and often the New Year brings fresh ideas and more interesting content.

Have a great night!

Overbought-Oversold levels for December 17, 2008

ETF Extremes Options Trading Strategy

* S&P 500 (SPY) – 60.2 (neutral)
* Dow Jones (DIA) – 58.3 (neutral)
* Russell 2000 (IWM) – 63.5 (neutral)
* NASDAQ 100 (QQQQ) – 59.8 (neutral)

Sector ETF Extremes Options Strategy

* Biotech (IBB) – 69.6 (neutral)
* Consumer Discretionary (XLY) – 69.8 (neutral)
* Health Care (XLV) – 70.5 (overbought)
* Financial (XLF) – 57.5 (neutral)
* Energy (XLE) – 62.9 (neutral)
* Industrial (XLI) – 66.2 (neutral)
* Materials (XLB) – 72.2 (overbought)
* Real Estate (IYR) – 66.4 (neutral)
* Retail (RTH) – 64.3 (neutral)
* Utilities (XLU) – 44.5 (neutral)

Ultra Extremes (Insiders Page Only)

* Ultra Long (SSO) – 59.6 (neutral)
* Ultra Short (SDS) – 36.2 (neutral)

If you would like to follow my strategies with real-time alerts or have them auto-traded by a participating broker please click the following link! Try my options trading strategies.

Potential Signal Ahead?

I am going to keep it rather short tonight.

All of the major benchmarks have moved close to a  short-term overbought state after the nice rally today. The market moved higher at the open today and never looked back as the day progressed. The Fed announcement was just icing on the cake.

Now the S&P has moved close to the highs from last week. This area should act as a decent area of overhead resistance while the 900, 880 and most notable, the 850 area should act as potential areas of support.

I would also like to point out that a few of the sector ETFs that I follow have officially moved into a hort-term overbought state. That being said there is a very good chance to see our first trade in a few months in the Sector ETF Extremes strategy over the next few trading sessions. Subscribers stay tuned!

One last note is that we closed near the highs of the day today so we also have the potential to witness a Gap Fade trade tomorrow. Could we see the trifecta tomorrow? It sure would be nice, especially if they were all profitable signals. Subscribers, as always I will send out a real-time trade alert if and when a trade occurs. Again, stay tuned.

Have a great night!

Andy

Overbought-Oversold levels for December 16, 2008

ETF Extremes Options Trading Strategy

* S&P 500 (SPY) – 65.9 (neutral)
* Dow Jones (DIA) – 67.5 (neutral)
* Russell 2000 (IWM) – 68.9 (neutral)
* NASDAQ 100 (QQQQ) – 66.7 (neutral)

Sector ETF Extremes Options Strategy

* Biotech (IBB) – 68.0 (neutral)
* Consumer Discretionary (XLY) – 68.3 (neutral)
* Health Care (XLV) – 77.6 (overbought)
* Financial (XLF) – 59.9 (neutral)
* Energy (XLE) - 56.2 (neutral)
* Industrial (XLI) – 66.0 (neutral)
* Materials (XLB) – 71.9 (overbought)
* Real Estate (IYR) – 63.7 (neutral)
* Retail (RTH) – 64.2 (neutral)
* Utilities (XLU) – 58.9 (neutral)

Ultra Extremes (Insiders Page Only)

* Ultra Long (SSO) – 65.1 (neutral)
* Ultra Short (SDS) – 31.5 (neutral)

If you would like to follow my strategies with real-time alerts or have them auto-traded by a participating broker please click the following link! Try my options trading strategies.

Will the Week of December Options Expiration Live Up to its Historical Billing?

First, I would like to say that tomorrow promises to be an exciting trading day with the FOMC announcement at 2 EST and a plethora of economic reports before the opening bell. Get ready!

The week of December options expiration started of much like it has on a historical basis – negative. Over the last 17 years less than 50% of expiration Monday’s (when a FOMC is scheduled) finished in negative territory. While falling in line with the historical norms, it certainly does not represent a trading edge.

However, as a whole, an options expiration week that contains a scheduled FOMC meeting has finished in positive territory roughly 80% of the time with a gain close to 2%.

Furthermore,  as I have mentioned several times over the past few weeks, December has displayed a positive bias, particularly in the S&P 500 and when taking a closer look at how the S&P, particularly the S&P futures have performed during the week of options expiration the performance is overwhelmingly positive with 24 out of the last 26 years posting a gain for the week.

I will try and post a few charts that I am watching closely later tonight. Stay tuned.

Overbought-Oversold levels for December 15, 2008

ETF Extremes Options Trading Strategy

* S&P 500 (SPY) – 48.9 (neutral)
* Dow Jones (DIA) – 48.2 (neutral)
* Russell 2000 (IWM) – 45.6 (neutral)
* NASDAQ 100 (QQQQ) – 49.5 (neutral)

Sector ETF Extremes Options Strategy

* Biotech (IBB) – 48.2 (neutral)
* Consumer Discretionary (XLY) - 49.8 (neutral)
* Health Care (XLV) – 55.7 (neutral)
* Financial (XLF) - 37.8 (neutral)
* Energy (XLE) - 56.2 (neutral)
* Industrial (XLI) - 44.4 (neutral)
* Materials (XLB) - 53.1 (neutral)
* Real Estate (IYR) - 49.7 (neutral)
* Retail (RTH) – 48.9 (neutral)
* Utilities (XLU) – 42.3 (neutral)

Ultra Extremes (Insiders Page Only)

* Ultra Long (SSO) – 44.7 (neutral)
* Ultra Short (SDS) – 49.7 (neutral)

If you would like to follow my strategies with real-time alerts or have them auto-traded by a participating broker please click the following link! Try my options trading strategies.

Finally, well, almost

I am finally back after a two day hiatus. Of course, there are a few more adjustments that need to made to the site, but the new, wider version should allow me to post more charts which is something I have wanted to do for quite some time but the format of the blog was not really accommodating.  Well, now it is, so get ready for some big changes.

As for the current state of the market, well, 900 just could not hold as expected (post from a few days back). Moreover, the futures are down substantially overnight and unless something drastic occurs I expect to see a gap down tomorrow. It could be our first gap trade in quite some time so all of you Gap Fade subscribers be ready.

As for the other two strategies, well, a move back down to a short-term oversold state could lead to a nice short-term opportunity for the bulls. We shall see soon enough.

The ETF Extremes strategy contniues to outperform the market by a substantial margin and with a little help our other two strategies could be back in the black before you know it. They are basically flat on the year which compared to the market is pretty damn good. Unfortunately, not good enough.

There will be a few changes made to the benefit of subscribers as we enter 2009 so stay tuned.

I hope all of you are having a wonderful holiday season.

Andy

Overbought-Oversold levels for December 11, 2008

ETF Extremes Options Trading Strategy

* S&P 500 (SPY) – 49.2 (neutral)
* Dow Jones (DIA) – 47.7 (neutral)
* Russell 2000 (IWM) – 45.8 (neutral)
* NASDAQ 100 (QQQQ) – 49.5 (neutral)

Sector ETF Extremes Options Strategy

* Biotech (IBB) – 45.9 (neutral)
* Consumer Discretionary (XLY) – 52.6 (neutral)
* Health Care (XLV) – 56.5 (neutral)
* Financial (XLF) – 41.2 (neutral)
* Energy (XLE) – 63.7 (neutral)
* Industrial (XLI) – 43.3 (neutral)
* Materials (XLB) – 52.8 (neutral)
* Real Estate (IYR) – 42.5 (neutral)
* Retail (RTH) – 48.1 (neutral)
* Utilities (XLU) – 48.7 (neutral)

Ultra Extremes (Insiders Page Only)

* Ultra Long (SSO) – 48.0 (neutral)
* Ultra Short (SDS) – 46.3 (neutral)

If you would like to follow my strategies with real-time alerts or have them auto-traded by a participating broker please click the following link! Try my options trading strategies.

Still Working

We are still working on the stylesheet for the blog. I will have an update (hopefully tonight) as soon as it is complete. Thank you for your patience. I know from the emails that many of you are chomping at the bit.

Kindest regards,

Andy

Late/Early Post

We are working on the layout of the wesbite so I will most likely not have a post until early tomorrow morning, possibly sooner. 

Take care,

Andy

Near short-term overbought reading

Could we see a signal in the strategies (ETF and Sector) over the next few days? With the opening gap unable to close and a move to short-term “near overbought” status it certainly would not be out of the question. 

I am watching the 9000 level on the Dow and a move through that level could take the blue-chip index up to its next overhead resistance level around 9600 very quickly.

I will also be watching the support level of QQQQ at $29.25. 

The gap today lowers the probability of a contiued move to the upside over the short-term. I would not be surpised to see the gap close over the next few days. If that does occur, the market would be at another important level of support.

Just a few thoughts.

Have a great night!

Andy

Overbought-Oversold levels for December 8, 2008

ETF Extremes Options Trading Strategy

* S&P 500 (SPY) – 65.7 (neutral)
* Dow Jones (DIA) – 65.4 (neutral)
* Russell 2000 (IWM) – 65.9 (neutral)
* NASDAQ 100 (QQQQ) – 67.4 (neutral)

Sector ETF Extremes Options Strategy

* Biotech (IBB) – 64.7 (neutral)
* Consumer Discretionary (XLY) – 76.1 (overbought)
* Health Care (XLV) – 64.7 (neutral)
* Financial (XLF) – 72.3 (overbought)
* Energy (XLE) – 51.2 (neutral)
* Industrial (XLI) – 65.2 (neutral)
* Materials (XLB) – 69.7 (neutral)
* Real Estate (IYR) – 72.2 (overbought)
* Retail (RTH) – 76.7 (overbought)
* Utilities (XLU) – 52.3 (neutral)

Ultra Extremes (Insiders Page Only)

* Ultra Long (SSO) – 64.5 (neutral)
* Ultra Short (SDS) – 32.0 (neutral)

If you would like to follow my strategies with real-time alerts or have them auto-traded by a participating broker please click the following link! Try my options trading strategies.

Sustained Gains are the Gains That Count

The market is still range bound on a short-term basis. As I stated yesterday, the longer the market remains range bound the sharper the move outside of the range no matter the time frame. Basically, yesterday’s post will suffice for tonight’s post. So, with that being the case I will keep the post very, very short tonight.

I will continue to sit patiently on the sidelines waiting for Mr. Probability to become favorable and then take the appropriate action. Right now, at least for the technical indicators I prefer to use, the market is not showing its hand. Remember, opportunities are made up easier than losses and as I always state “Patience Pays”. Keep these little sayings in mind when signals are few and far between with certain strategies. This is a marathon and not a sprint. Okay, I had to get that last one in there for good measure. Anyway, again keep the aforementioned sayings in mind. They will often lead to the gains that count – sustained gains.

Have a great night!

Andy

Overbought-Oversold levels for December 4, 2008

ETF Extremes Options Trading Strategy

* S&P 500 (SPY) – 48.4 (neutral)
* Dow Jones (DIA) – 46.7 (neutral)
* Russell 2000 (IWM) – 47.3 (neutral)
* NASDAQ 100 (QQQQ) – 45.8 (neutral)

Sector ETF Extremes Options Strategy

* Biotech (IBB) – 49.8 (neutral)
* Consumer Discretionary (XLY) – 63.8 (neutral)
* Health Care (XLV) – 47.8 (neutral)
* Financial (XLF) – 53.1 (neutral)
* Energy (XLE) – 33.7 (neutral)
* Industrial (XLI) – 50.1 (neutral)
* Materials (XLB) – 43.0 (neutral)
* Real Estate (IYR) – 50.2 (neutral)
* Retail (RTH) – 65.9 (neutral)
* Utilities (XLU) – 42.2 (neutral)

Ultra Extremes (Insiders Page Only)

* Ultra Long (SSO) – 45.5 (neutral)
* Ultra Short (SDS) – 48.2 (neutral)

If you would like to follow my strategies with real-time alerts or have them auto-traded by a participating broker please click the following link! Try my options trading strategies.

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