HI Financial Services Mid-Week 08-05-2014
No matter what you’re going through, there’s a light at the end of the tunnel and it may seem hard to get to it but you can do it and just keep working towards it and you’ll find the positive side of things. Demi Lovato
What is the positive side to the downturn?
Buying opportunity to buy stocks cheaper?”!!!, Dollar cost averaging (with profits form the option protection on stock without having to spend more money to do so, You could play the market or index hedge “directional” on the indexes for portfolio protection.
Doing the math indexes lost 0.97% to 0.71% loss whereas using the SOS strategies I lost 0.0013% or a little more than one tenth of a percent still having plenty of upside movement.
What has been happening so far this week?
Fear, What’s not happening this week, may be the start of a correction = 20% + drawdown in the market, Technical weakness
Headline risk still exists – Gaze Strip, Russian , Ukraine, Argentine Debt, Fed raising interest rates way to early even though they are supposed to be behind the curve
Good news is “perceived” to be bad news like ISM Index 58.7 vs est 57.5 and Factory orders were 1.1 vs est 0.5
Where will our market end this week?
I don’t know and I wouldn’t try to guess.
I know that I want to be hedged !!!!
DJIA– Bearish market technically, 200 SMA setting up as possible support, average selling volume which means we do NOT have panic selling, little bounce off the oversold line
SPX – Technically bearish, broke the 50 SMA, next level of support is horizontal level = easily broken 1910
COMP – Technically bearish, but I see it fighting for 50 SMA support
Where Will the SPX end August 2014?
08-05-2014 I would be looking for more movement to the down side. I would expect maybe another 2% down on the SPX and let’s test the 200 SMA.
What is on tap for the rest of the week?=
Tues: ATVI, COH, FEYE, FSLR, GRMN, MWW, PZZA, ODP, DIS, Z
Wed: AOL, DVN, DBD, DNB, RIG, JACK, TAP, NUS, TWX
Thur: AES, ATLS, CBS, CLDN, LINE, LNCO, LGE, NWSA, SCTY, SRE, WEN, ZNGA
Tues: Factory Orders, ISM Services,
Wed: MBA, Trade Balance
Thur: Initial Claims, Continuing Claims, Consumer Credit
Fri: Productivity, Wholesale Inventories, Unit Labor Costs
Tues – EMU: Retail Sales
Wed – DE: Manufactures Orders, GB: Industrial Production
Thurs – JP: BOJ Announcement, EMU: ECB Announcement
Friday – CN: Merchandise Trade Balance, CPI, PPI, FR: Industrial Production
Sunday – JP: Tertiary Index
How I am looking to trade?
I am in Collar Trades and/or Protective Puts for earnings.
AAPL – Exploding Collar Trade I’m not losing money in the trade today on another 100 + point down day in the market with plenty of upside potential!!! Worried about the long term short call positions? Well they were sold for $7.9985 and currently are worth $8.25 so for all intensive purposes I am down a Quarter ($0.25) in the position per share.
BBY – Not down in an adjusted collar by adding short puts to the long puts.
V standard same month for puts and calls collar made more to the downward movement today!
NVDA – The reason I don’t spend a whole lot of time with the Greeks! The stock made a penny and the downside protection that is supposed to only make money in a stock losing money yet it made 15 cents today.
That means you need to build you earnings list
BBY 8/26 BMO
CLDX 8/6 AMC
DIS 8/5 AMC
LNCO 8/7 BMO
MEI 8/28 est
NVDA 8/7 est
XOM trade and comments –
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