1/27 Morningline

A slow start to the morning, as is traditional on days when the Federal Open Market Committee has scheduled an announcement (at 2:15 p.m. Eastern). Of course, these days the Fed doesn't really change rates so much as it tweaks expectations as an exercise in applied psychology.

Riddle: A word with two meanings. One is work that keeps one fed. The other is what happens to expectations when people are fed up. . . .

Looking at a JCI Trade

The JCI trade identified in today's Watchlist continues to pique my interest, mainly because of the strong trend.

A bull put options spread, created by buying the February $27.5 strike price and selling the $30 strike, would be profitable from a bit above $29 upward. A price of $29 is below near-term resistance, and when the stock fell to that resistance area today, the day after the bull signal, it promptly bounced back up to just below its opening price.

I don't like to buy bullish on a declining day. However, I'll be looking at JCI in the morning to see if it's worth getting into. The net premium on the bull put spread would be about 87 cents at the current price.

1/26 Watchlist

The blue chip stocks (SPY) have risen to the top of Monday's trading range, and then pulled back. Today's high so far: $110.47. Monday's high: $110.41.

This is not progress.

The Treasury long bonds (TLT) are within the 5 cent difference between the high and low on Monday. Also, barely moving, despite a higher opening this morning from which the price dropped. . . .