Stock Market, No Selling Yet
Stock-Markets / Stock Index Trading Aug 30, 2009 - 12:30 PM GMTBy: Jay_DeVincentis
No Selling Yet
The market is holding up well, which weighs into our call.
SOS Timing Indicator
The timing indicator is mixed here. And the markets tried to sell off on Thursday but reversed. The gap up close lower on Friday may still be bullish, since the depth of the retracement merely closed the gap set Friday morning. The EPCR is a little complacent. And the TRIN is moving in the direction of bullishness. The VXN is breaking lows, so while it looks like it’s at support, it’s also trending lower, which is bullish.
In the top pance, the advance decline line has pulled back nicely during this sideways move. That suggests we have some more room to run on the upside. Some of my cycle work calls for tops around 9/14 and 9/21...
Stock Options Speculator uses the above indicator in the establishing of various options trades and strategies. The indicator has two frames. The top frame shows the Nasdaq Composite and the Nasdaq Advances and Declines. The lower frame shows volatility (candles), the equity put call ratio (red line) and the Trading Index (blue line). The height of the indicators determines if call or put buying strategies are recommended.
Options Trading Ideas
Based on the SOS Timing Indicator or other special market conditions, the above 10 trades are recommended for consideration in your trading plan.
Risk Graphs
The following risk graphs show stock price plotted against potential profitability. They're listed alphabetically.
Closing Bell
Well, the market hasn’t done much of anything of late, we continue to position for moves higher and lower as that’s what we do. You never know when the market will break in one direction or the other, you just have to continue to position for the most likely move, with some consideration towards magnitude. But since we position weekly, magnitude is limited.
These searches usually give us the most fairly priced options, which means they have a low implied volatility - seeing that if they start to move, IV will rise as well, contributing to the gains of the position. They are also ranked by the lowest price movement relative to increase in option pricing. Point is, the Nasdaq 100 optionable stocks will tend to have slightly higher volatility - so here’s that list and it’s worth considering:
Regards,
If you have any questions or comments, email me at Jay@stockbarometer.com.Regards,
By Jay DeVincentis
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