1/27 Almanac

Wednesday, Jan. 27, is 23 days before the February options expire, 51 days the March and 79 days the April.

Historically, it tends to be an up day of the week on an up day of the month in an up month. . . .

In this period my rules allow trades in February vertical, calendar, butterfly and diagonal spreads, as well as covered calls. I'm trading April expiration options for unhedged call and put purchases. These economic reports will be released: New home sales, 10 a.m. Eastern, a measure of economic recovery that can have implications beyond the housing industry Petroleum inventories, 10:30 a.m., a weekly report that impacts mainly the energy sector, but also inflation expectations.

These other events will happen:

• Treasury Secretary Tim Geithner will testify before the House Oversight Committee at 10 a.m. Eastern. The hearing concerns the government bailout of the insurance company AIG during the collapse of capitalist finance.
• President Obama delivers his first state of the union address at 9 p.m. I can't imagine this having much market impact, since so many details have already been leaked ahead of time (as is traditional).

My portfolio consists of:

• CVS, iron condor, p28/-p31/-c34/c36
• ERTS, iron condor, p15/-p16/-c18/c19
• PALM, covered call, s/-c13

Blue chip stocks (SPY) closed the regular session on Tuesday at $109.31, down 0.4 percent from the prior close.

Mediawatch: Final reports said the indexes fell because of analysts estimated the cost of the Volcker plan to reform banking. Intra-day reports said stocks rose because consumers were more confident.

In total, 3.5 billion shares were traded on the three major U.S. stock exchanges.