Saturday, February 8, 2014

The Week Ahead: Industry, retail and Fed Chair Yellen's debut

Both ends of the supply chain get their moment in the sun this week, the beginning in the form of the Federal Reserve's industrial production report out on Friday at 9:15 a.m. New York time and the end with the Census Bureau's comprehensive retail sales report on Thursday at 8:30 a.m.

Also, Federal Reserve Chair Janet Yellen delivers her first semiannual monetary report to Congress in testimony before the House Financial Services Committee on Tuesday at 10 a.m. and the Senate Banking, Housing and Urban Affairs Committee on Thursday at 10:30 a.m.

Leading indicators (in descending order of importance):

The interest rate spread between 10-year Treasuries and the federal funds rate, reported continually during market hours.

The M2 money supply, at 4:30 p.m. Thursday.

The S&P 500 index, reported continually during market hours.

Average weekly initial jobless claims, at 8:30 a.m. Thursday. 

The Reuters/University of Michigan consumer sentiment report, at 9:55 a.m. on Friday.

Other reports of interest:

Wednesday: Petroleum inventories at 10:30 a.m. and the Treasury budget, giving the federal deficit, at 2 p.m.

Thursday: Business inventories at  10 a.m.

Friday: Import and export prices at 8:30 a.m.

I also keep an eye on the Baltic Dry Index, updated daily.


Federal Reserve glitterati in addition to Fed Chair Yellen are on the public appearance calendar this week:

  • Two Federal Open Market Committee members, Philadelphia Fed Pres. Charles Plosser and Dallas Fed Pres. Richard Fisher, on Tuesday.
  • An FOMC alternate, Richmond Fed. Pres. Jeffrey Lacker, on Tuesday.
  • St. Louis Fed Pres. James Bullard, who has no FOMC role this year, on Wednesday.

Analytical universe

This week through Wednesday I shall be analyzing new bull and bear signals among 299 high-volume large-cap stocks and exchange-traded funds that have some analyst interest.

I shall be traveling in East Asia from Thursday through late February. To shorten processing time while I'm on the road, I have reduce my analytical universe to the 299 most liquid stocks and exchange traded funds. I shall resume analysis of the large universe, which exceeds 3,000 shares, in late February.

Trading calendar

By my rules, I'm trading March options for the short legs of vertical, diagonal and calendar spreads and covered calls, and for all legs of butterfly spreads and iron condors. I'm trading May options for single calls and puts as well as straddles. Shares, of course, are good at any time.

Good trading.

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