Friday, October 17, 2008

Options ex Friday


For an options expiration day I think the market actually behaved fairly well and aside from the pullback at the end of the day (and that's all it was), I think the market had a constructive week that we can build upon next week perhaps. From the bottom of the range yesterday at roughly 8200 on the Dow to todays high of around 9200...this market deserved to selloff in the last hour. Again, how can you fault the decisions of those who sold into the weekend on the heels of a 1000 point in the Dow in roughly 2 days? You can't.

With options ex today I was also surprised to see a relatively calm atmospehere to the price action. Usually you see either a chopfest all day long or just massive swings intraday. But I guess since that is now the norm, lol, it makes sense to see options ex present us with something a bit different. The market never ceases to amaze me.

Had some great earnings to GOOG last night after the bell so that was encouraging to see that the recession is not completely killing advertising spending. Next week the earnings calendar really gets going and I will try to go over a detailed outlook of this over the next few days.

Given that options ex is a bit quirky usually I would like to see the action Monday to determine where this market wants to go but as of right now I am liking what I see on the daily chart after yesterdays outside reversal. The 60 min and 30min of the ES futures look more bullish than they have in weeks imo. If the SPX can gather some steam and hold this 900-920 level with authority then I will be advising some trades to the long side. Also, if we can get this VIX down a bit lower to like the 40s or so then I would finally be willing to throw out some new options trades. Lately, I havent been holding much of anything overnight unless I'm hedged completely because it simply hasn't been worth the risk. Especially when you can make a fortune during insane intraday swings we have grown accustomed to in this environment, then go to sleep in cash. :)

With that said, I will be looking to research a few names over the weekend to perhaps recommend some great options trading ideas for the coming weeks. If you made it through this week, congrats, you are no longer an amateur! And to all the new readers thanks for visiting The Trading Pit during your day.

No comments: