Thursday, November 17, 2011

11/18 Almanac

On Friday, Nov. 18: Leading indicators.

This is the last trading day before the November options expire. There are 29 trading days before the December options expire, 64 the January, 92 the February and 120 the March.

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


Blue chip stocks (SPY) closed the latest regular session down 1.6% from the prior close. During the day SPY traversed 2.4% in a net move down of 1.4%.

The day's extremes: Open $123.85, high $124.16, low $121.23, close $122.11.

SPY closed below the DeMark pivots after trading within their range. The next DeMark pivots are $120.21-$123.14.

In total, 3.1 billion shares were traded on the three major U.S. stock exchanges, 11% more than on the prior trading day.

Implied volatility suggests a 68% chance that SPY will close, 30 days from now, between $109.98 and $134.24. The range is +/- $12.13 from the last closing price, 30¢ wider than on the prior trading day.

Bond yields imply that inflation, over the next five years, will average 1.70%, six basis points lower than on the prior trading day.

Econ reports

A light Friday to cap the week, with one economics report, leading indicators, out at 10 a.m. Eastern. The leading indicators report isn't considered to be a market mover, but it is still one of my favorite releases because it looks forward.

Two members of the Federal Open Market Committee are scheduled to speak: New York Fed Pres. William Dudley at 8:15 a.m. and Dallas Fed Pres. Richard Fisher at 1:15 p.m.

Dudley, who on Wednesday said the Fed can do more to boost the economy, has had institutional ties to Goldman Sachs and the Congressional Budget Office under Presidents Bill Clinton and George W. Bush. He took office under President Obama.

Dallas Fed Pres. Richard Fisher, one of three FOMC members who dissented during the summer in votes on expanding the money supply to encourage economic growth, has previous institutional ties to former Secretary of State Henry Kissinger’s strategic advisory firm, the private bank Brown Brothers Harriman Inc., and his own money management firm. He took office under President George W. Bush.

The Federal Reserve maintains an archive of selected speeches and testimony.

Trading Calendar:

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

Good trading!

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