Yo Pit Crazies,
Another whipsaw 2% move!
The sentiment started on Wednesday morning pretty rosy with some good earnings reports from, of all places, International Business Machines Corp (Ticker: IBM) and AT&T Corp. (Ticker: T).
Even Tesla Inc (Ticker: TSLA) had decent earnings, but not enough to drive a higher stock price as I alluded to yesterday.
Then it got ugly again as yet another Fed governor, past or present, laid down the dredded 5% rate picture. Stocks sold off in a hurry.
Add a little inflation baiting from politicians and everything got a little worse.
But there was a green shoot, of sorts.
(Oh, and Mark Sebastian posted a near-400% winner in Big Money Flow. More on that at the end)
VIX Down, Stocks Down Means the Market Is a Little Less Grumpy
The ECB will likely raise rates by .75 bps next week, on the 27th. Traders know this, and if the ECB does, the Fed likely will do the same.
The fact that these things are well known to happen is putting somewhat of a floor on stock prices. We hit that floor of 3500 last week and bounced near 250 SPX points from there.
VIX has declined steadily since. After the mic drop from yet another Fed person of interest, traders sold stocks again. They can handle the current raft of rate hikes it seems, just not a new acceleration.
I still see the election as the market turning point, as the more divided congressional body tends to spend less money. That is the tonic stocks needed to get the ship sailing in the right direction.
The Fed ship has sailed and is not here to help stocks, but I do like positioning for a rally in stocks post election.
The Rundown
Big Money Flow
Big Money Mark lived up to the title with a huge, near-400%+ win in Ericsson LM (Ticker: ERIC) puts Thursday Morning.
Vol Edge
Mark’s week is looking sweet with a 78% gain in a VIX 30/37.5/45 call butterfly.
OPM Div+
I collected the Dividend in Southern Copper Co. (Ticker: SCCO) for a 1% gain in my Div+ strategy. The SPX was down 10% during that holding period so I can reinvest again today. HOT DOG! 10 wins in a row there.
SPYMaster
I am 11-for-17 in my SPYMaster strategy and another 3% win closed this week.
Power Income Trader
Bill is keeping to the short side of banks with a 28% gain in Select SPDR Financial ETF (Ticker: XLF) Nov. 19 33/31 put spreads.
To Your Trading Success,
AG