Tuesday, October 4, 2011

10/5 Almanac

On Wednesday, Oct. 5: ADP employment, ISM non-manufacturing index.

There are 17 trading days before the October options expire, 45 the November, 73 the December and 108 the January.

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


Blue chip stocks (SPY) closed the latest regular session up 2.2% from the prior close. During the day SPY traversed 4.8% in a net move up of 3.7%.

The day's extremes: Open $108.35, high $112.58, low $107.43, close $112.34.

SPY closed above the DeMark pivots after trading below their range. The next DeMark pivots are $109.89-$115.04.

In total, 3.8 billion shares were traded on the three major U.S. stock exchanges, 15% more than on the prior trading day.

Implied volatility suggests a 68% chance that SPY will close, 30 days from now, between $99.29 and $125.39. The range is +/- $13.05 from the last closing price, $1.10 narrower than on the prior trading day.

Bond yields imply that inflation, over the next five years, will average 1.55%, one basis point lower than the prior trading day.

Econ reports:

Today begins the preliminary rumbles leading up to Friday's employment report, sort of like the trembling glass of water in Jurassic Park when T-Rex strides onto the scene.

The payroll people, ADP, release their employment report at 8:15 a.m. Eastern, following the Challenger, Gray & Christmas employment layoffs report at 7:30 a.m. The ADP report sometimes moves markets; Challenger -- not so much.

The next pre-shock comes on Thursday, with jobless claims.

Also out, the Institute of Supply Management's non-manufacturing index at 10 a.m. and petroleum inventories at 10:30 a.m., both potentially impactful on traders.

The Mortgage Bankers report on purchase applications at 7 a.m.; the report is considered a home sales leading indicator.

No Fedsters at the podium.

The Federal Reserve maintains an archive of speeches and testimony.

Trading Calendar:

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

Good trading!

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