CNBC Is A Joke – Change To Fox Business – SPY Will Trade Between $206 and $121 Thru Nov Expiration

October 29, 2015
Author: Peter Stolcers, Founder of OneOption

Posted 9:50 AM ET - I watched the CNBC GOP "debate" last night and after 25 years, that is the last time I will turn the channel on. What a bunch of crap. I'm not going to go into the details because you can read about this liberal attempt to embarrass Republicans everywhere else. Needless to say, CNBC's plan backfired and I hope more traders boycott the station. I was hoping to hear how each candidate was going to stimulate economic growth - after all, CNBC considers themselves a business channel. The moderators were so busy trying to 1-up each other with "clever" jabs at conservatives that they never got to the most important challenge our nation faces. Turn on Fox Business and watch Stuart Varney. He is intelligent and entertaining. Had to get that off of my chest. Yesterday the FOMC kept a December rate hike on the table. In their statement they said that foreign markets (China) are no longer a concern. This tone was perceived as hawkish and the S&P 500 fell 20 points. Once the low was established, buyers stepped in and the market closed on the high of the day. We are now within striking distance of the all-time high. I've been urging you to take profits on your call positions and I still believe this was prudent. You will be able to catch the remainder of this rally day trading. The strength yesterday came as a bit of a surprise and I've concluded that the market is not going to fall for the Fed's scare tactics. Liftoff has been postponed quarter after quarter and traders don't believe that we will see a rate hike in 2015. I don't believe that the market is "fine" with a quarter-point rate hike. When it actually happens, the stocks will retreat. Economic conditions are tenuous. This morning, GDP rose 1.5%. That is half of what was expected. Official PMI's will be posted Monday. China no longer posts the flash number and this will be our first look at their economy. I am expecting a decent number. The jobs report next week should be back to the 200,000 level and September's number will be revised upward. There is a strong bid at the 200-day moving average and there is strong resistance at the all-time high. I believe the market will trade in a range between SPY $206 and $212 through November options expiration. Strong stocks keep grinding higher and weak stocks keep drifting lower. I will sell out of the money call credit spreads in these groups (basic materials, heavy equipment, retail and restaurant). I will sell out of the money put spreads in these groups (financials, tech and defense). If the market breaks out or breaks down, I will buy back the credit spreads that are on the "wrong side". As we head into the back half of earnings season, the excitement will wane. Look for choppy trading today. I will day trade from the long side and I will focus on mega-cap tech stocks that have been grinding higher after a breakout. . . image

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