Monday, July 11, 2011

7/12 Almanac

On Tuesday, July 12: International trade, money policy minutes.

There are four trading days before the July options expire, 39 the August, 67 the September and 102 the October.

On the jump, market stats, econ reports, and the trading calendar . . .


Blue chip stocks (SPY) closed the latest regular session down 1.8% from the prior close. During the day SPY traversed 1.1% in a net move down of 0.6%.

The day's extremes: Open $132.75, high $133.18, low $131.66, close $131.97.

SPY traded entirely below the DeMark pivots. The next DeMark pivots are $131.06-$132.58.

In total, 2.6 billion shares were traded on the three major U.S. stock exchanges, 12% more than on the prior trading day.

Five-year bond yields imply inflation at 2.10%, two basis points lower than on the prior trading day.

Econ reports:

The Commerce Department releases May's international trade figures at 8:30 a.m. Eastern. This report tracks how much money we're spending outside U.S. borders to buy their stuff, vs. how much the other countries are paying us to buy our stuff. It impacts the value of the dollar against other currencies, among other things.

The Federal Open Market Committee, which sets monetary policy, at 2 p.m. makes public the minutes of its June 24 meeting. The minutes can add nuance to the announcements made the day that the FOMC meetings adjourn, and more often than not, they add nothing significant (although they do provide amusement for the day-traders.)

I would argue that the minutes carry even less weight now that Fed Chairman Ben Bernanke is following each meeting with a news conference. The markets are suffering from Fed information overload long before the minutes come out.

Also on the calendar, two weekly retail reports: ICSC-Goldman at 7:45 a.m. and Redbook at 8:55 a.m.

Treasury auctions 4-week bills at 11:30 a.m. and 3-year notes at 1 p.m.

No Fedsters speechifying. The Federal Reserve maintains an archive, where it posts transcripts of speeches and testimony within a few days of the event.

Good Read:

Speaking of the Fed, Bloomberg News has written up an outstanding interview with Mary Daly, who is v.p. for microeconomic research at the San Francisco Federal Reserve Bank. An interesting counter-perspective to the employment structural gloom and doom media boom that followed last Friday's Labor Department report.

Trading Calendar:

By my rules, at this point in the cycle I can trade August vertical, diagonal, calendar and butterfly spreads, iron condors and covered calls, as well as October or later straddles, strangles, calls and puts. And of course, shares are good at any time.

Good trading!

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