There are three trading days left before April options expire, 38 the May and 66 the June.
On the jump, market stats, mediawatch, rules, econ reports, portfolio and a good book...
Blue chip stocks (SPY) closed the latest regular session up 0.1% from the prior close. During the day SPY traversed 0.9% low to high in a net move up intraday of 0.2%. (This is not moving. This is fidgeting.)
Today's extremes: Open $119.62, high $120.04, low $119.00, close $119.83.
SPY traded as much as 65¢ below the DeMark pivots but closed within them. The next DeMark pivots are $119.42/$120.46.
In total, 3.6 billion shares were traded on the three major U.S. stock exchanges, up 600 million from the prior day.
Mediawatch: As Alcoa goes so goes the markets. Or so AP says. Problem is, the market went nowhere, and Alcoa earnings went somewhere. So it's pretty lame. Reuters compounded the lameness by offsetting Alcoa with Intel. Sorry, lameness squared or even cubed is still . . . lame. I think the problem is that Stephen Bernard and Tim Paradis for AP and Caroline Valetkevitch for Reuters are trying to explain inaction by action. That only works in chess, when the King is pinned, but not really in assessing markets. | Financial consultant Leslie Masonson describes a strategy for using relative strength to trade exchange-traded funds for increased returns. |
Econ reports: A busy day, with big implications for markets.
The consumer price index will be released at 8:30 a.m. Eastern. This measures inflation, and if it's higher than expected, then traders will increase the odds that the Fed will raise interest rates soon. That would be a negative for both stocks and bonds.
The retail sales numbers are also out at 8:30 a.m. Are we spending our way back to prosperity? If the numbers are higher than expected, then it suggests the possibility of a heating economy, and higher interest rates ahead. If lower, then the odds are the Fed won't be shutting down the party.
Those two reports will set the tone for the market opening.
The business inventories stats are out at 10 a.m. It's a barometer of what business managers expect: Rising inventories means an expectation of increased sales.
The petroleum inventories report is out at 10:30 a.m. The main impact is on the energy sector, although a major surprise can impact the market broadly as it relates to energy prices, which have a bearing on inflation (see consumer price index above).
I love days like this where all the reports hang together in one huge system. And it all comes down to the Federal Open Market Committee and how they'll read the numbers. The paradox is that rising business activity suggests higher interest rates, which choke off business activity. Capitalism is an unstable system.
And to add to the complexity of the day, speeches:
- Fed Chairman Bernanke, 10 a.m., testifies on the Hill.
- Richmond Fed President Jeffrey Lacker, 11 a.m., a speech to econ students.
- Fed Gov. Kevin Warsh, 12:15 p.m., a speech at a college.
- Dallas Fed President Richard Fisher, 1 p.m., speech to an economics conference.
- New York Fed President Brian Sack, 7 p.m., lecture to university alumni.
Oh, and the Fed Beige Book is out at 2 p.m. It never makes any news, but it's a good background read.
My portfolio consists of . . .
April expiry:
- MCO, covered call, -c29
- BBY, bull call spread, c44/-c45
Dividend shares: AOD, JNK, NLY
Zombie shares: PALM.
Good trading!
New to private trading? Here's a look at How to Become a Private Trader.
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