Saturday, May 14, 2016

The Week Ahead: Prices, homes, industry, money policy

Prices, real estate, industry and the inside details of a money policy meeting will guide trading this week.

The consumer price index, a measure of inflation and deflation, will be published Tuesday at 8:30 a.m. New York time, as will housing starts. Industrial production  will reach traders shortly thereafter at 9:15 a.m.

Housing will take another bow with publication of the existing home sales report on Friday at 10 a.m.

Minutes of the Federal Open Market Committee meeting of April 26-27 will be released on Wednesday at 2 p.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 claims for unemployment from the jobless claims report at 8:30 a.m. Thursday.

Building permits for new private homes from housing starts at 8:30 a.m. Tuesday.

The index of leading indicators, although not itself a leading indicator, provides a useful You Are Here marker for where we are in the economic cycle. Out Thursday at 10 a.m.

Option Volatility and Pricing
by Sheldon Natenberg

Events arranged by day:

Monday: Empire State manufacturing survey of conditions in New York at 8:30 a.m., the Home Builders' housing market index at 10 a.m. and the Treasury Department's international capital report at 4 p.m.

Tuesday: The consumer price index and housing starts at 8:30 a.m. and industrial production at 9:15 a.m.

Wednesday: Petroleum inventories at 10:30 a.m. and FOMC minutes at 2 p.m.

Thursday:  Jobless claims and the Philadelphia Federal Reserve Bank business outlook survey of conditions in the Mid-Atlantic region, each at 8:30 a.m., leading indicator at 10 a.m. and the M2 money supply at 4:30 p.m.

Friday: Existing home sales at 10 a.m.

I also keep an eye on the Baltic Dry Index, updated daily, and the 5-year implied inflation rate based on U.S. Treasury yields, which presently stands at 1.53%, unchanged from a week earlier.

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., settlement Thursday.
  • 6-month: Auction Monday 11:30 a.m., announcement Thursday 11 a.m., settlement Thursday.
  • 52-week: Announcement Thursday 11 a.m.
  • 2-year: Announcement Thursday 11 a.m.
  • 5-year: Announcement Thursday 11 a.m.
  • 7-year: Announcement Thursday 11 a.m.
  • None,
  • 10-year: Auction Thursday 1 p.m.

Fed Gov. Daniel Tarullo speaks on insurance company supervision and regulation at a National Association of Insurance Commissioners forum in Washington, D.C. on Friday at 9 a.m.

One other FOMC member speaks: New York Fed Pres. Wiliam Dudley on Thursday.

Two FOMC alternates take to the podium: Minneapolis Fed Pres. Neel Kashkari on Monday and Dallas Fed Pres. Robert Kapan on Tuesday.

And one other of the Fed glitterati has scheduled an appearance: San Francisco Fed Pres. John Williams on Tuesday.

Analytical universe

This week I shall be analyzing new trading signals from among 479 large-cap stocks and exchange-traded funds.

Good trading!

-- Tim Bovee, Portland, Oregon, May 14, 2016


Tradecraft: Playing the odds to build winning stock market trades from options, a description of how I trade, can be read here.


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Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.
No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.

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