Sunday, January 25, 2015

The Week Ahead: GDP, FOMC, durables, new homes

The first 4th-quarter gross domestic product figures will be published Friday at 8:30 a.m. New York time, the first at three presumably increasingly accurate releases.

GDP is the broadest measure of growth growth, one of the key inputs in determining whether the economic porridge is too hot, too cold or just right, a task that will be taken up on Tuesday by the Federal Open Market Committee in its first meeting of 2015. The committee will issue a announcement of meeting results on Wednesday at 2 p.m.

Two other potential market movers punctuate the week, both on Tuesday: Durable goods orders at 8:30 a.m. and new home sales at 10 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 index of consumer expectations from the Reuters/University of Michigan consumer sentiment report, at 10 a.m. Friday.

Other items of interest:

Monday: The Dallas Federal Reserve manufacturing survey of conditions in Texas, at 10:30 a.m.

Tuesday: The S&P Case-Shiller home price index of 20 metropolitan areas at 9 a.m and the Conference Board consumer confidence index at 10 a.m.

Wednesday: Petroleum inventories at 10:30 a.m.

Thursday: The pending home sales index at 10 a.m.

Friday: The employment cost index at 8:30 a.m. and the Chicago Purchasing Managers index at 9:45 a.m.

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

Treasury Debt

  • 4-week: Announcement Monday 11 a.m., auction Tuesday 11:30 a.m., settlement Thursday
  • 3-month: Auction Monday 11:30 a.m., announcement Thursday 11 a.m.
  • 6-month: Auction Monday 11:30 a.m., announcement Thursday 11 a.m.
  • 52-week: Announcement Thursday 11 a.m.
  • 2-year floating rate: Auction Tuesday 11:30 a.m.
  • 2-year: Auction Tuesday 1 p.m.
  • 5-year: Auction Wednesday 1 p.m.
  • 7-year: Auction Thursday 1 p.m.
  • None
  • 10-year: Settlement Friday.

Fed Gov. Daniel Tarullo gives a speech on the subject "Advancing Macroprudential Policy Objectives" at the Office of Financial Research and Financial Stability Oversight Council's 4th annual conference, Thursday at 12:45 p.m.

Otherwise, the Fed glitterati have gone silent out of deference toward the Federal Open Market Committee meeting.

Analytical universe

This week I shall be analyzing new bull and bear signals among 1,189 mid-cap and larger stocks and exchange-traded funds.

Trading calendar

By my rules for shorter-term trades, I'm trading February options and later 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 and later for single calls and puts as well as straddles. Shares, of course, are good at any time.

Good trading.
-- Tim Bovee, Portland, Oregon, Jan. 25, 2015


My shorter-term trading rules can be read here. My longer-term trading rules can be read here. And the classic Turtle Trading rules on which my rules are based can be read here. My volatility trading rules can be read here.


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