1/11 Morningline: Euro Breaks Out; Fear Takes a Holiday

The euro per dollar currency pair, EUR/USD, shows a potential pps bull signal as it breaks out of an 11-day trading range. It will become the current signal if it still exists at the close of the U.S. markets. The dollars per yen, USD/JPY, pair shows no corresponding signal or movement.

The fear index, measuring volatility, gaps down by 6.5% and then falls further. Blue chips open higher and then, counter intuitively in light of the VIX, fall back into yersteday's trading range.

Gold gaps up by 1.8%.

No new signals on the indicators or holdings.

The numbers . . .


Indicators:

• Blue chips (SPY) open at 115.08, entered bull mode at close on Jan. 4 (at 113.33)
• Fear index (VIX) 16.93, bear (bullish for stocks), Jan.5 (19.35)
• Treasury long bonds (TLT) 88.99, bull, Jan. 5 (90.39)
• Corporate junk bonds (JNK) 40.12, bull, Jan. 4 (39.32)
• Gold (GLD) 113.34, bull, Jan. 4 (109.08)
• Oil (USO) 41.09, bull, Dec. 16, (36.74)

Currency pairs:

• Dollars per euro (EUR/USD) 1.4427 and rises to 1.4545 before pulling back, bear, Dec. 4 (1.49)
• Yen per dollar (USD/JPY) 92.58, bear, Jan. 5 (91.69)

Holdings, January expiry:

• KO, iron condor (p50/-p52.5/-c57.5/c60) 55.15, bear, Dec. 29 (57.74)
• LVS, covered call (-c16) 18.40, bull, Jan. 4 (16.62)
  
• SBUX, bull put spread (p22.5/-p24) 23.37 and falls to 23.01, bear, Dec. 30 (23.31)
  

Holdings, February expiry:

• CVS, iron condor (p29/-p31/-c34/c36) 34.18, bull, Jan. 5 (32.85)
  
• MRVL, bull put spread (p20/-p22.5) 21.48, bull, Nov. 25 (15.90)
  
• VALE, bull put spread (p30/-p32) 31.80, bull, Dec. 24 (28.93)

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Topics S&P 500, SPDR, Spiders, Treasury bonds, high-yield corporate junk bonds, gold, precious metals, oil, petroleum, CVS, pharmacies, drugs Coca-Cola, Las Vegas Sands, gambling, resort, Starbucks, coffee, Marvell Technology, Vale, Brazil, Mining.