Friday, May 15, 2009

Options Ex Friday

Going into the last day of the week the market is facing options expiration for the month of May and that just means you should expect some wacky choppy volatile action. The market is in pullback mode even though Thursday saw a slight bounce back into the 890s. It basically only retraced half of Wednesday's losses and even faded in the last hour so nothing was too impressive. Gold also didn't pullback much which is what you want to see lately to indicate a true appetite for risk. Overall I would still be looking for this market to retest that 875 mark maybe even on Friday with even a possible 850-860 retest next week.

For Friday I would be short biased especially if they hold it underneath the daily pivot on the ES futures of 889. Above that and they may try to test Thursday's highs or even the 900 mark which is probably home to plenty of open interest on both sides so it could be a interesting tug of war in the last few hours. Overall a day I would rather stay light on the trading side. Enjoy the weekend.

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