Economic Releases Will Help the Market Find Support – Beware Next Week

August 4, 2015
Author: Peter Stolcers, Founder of OneOption

CLICK HERE TO ATTEND THE LIVE WEBINAR TONIGHT I will show you a pattern that has been making great money and you will see the trades from today. Posted 11:30 AM ET - Yesterday, the market pulled back on a variety of worries. The SPY spent most of the day below the 100-day moving average, but it was able to recover before the close. Stocks are flat-lining today and we can expect light volume for most of the month. Apple broke its 200-day moving average and that is weighing on the market. This is "everyone's" darling and bullish speculators are getting flushed out. I mentioned that the market crash in China has been completely discounted by the market. Perhaps this is the first sign that investors are taking that into consideration. ISM manufacturing came in slightly below estimates. ADP, ISM services and the jobs report will be posted this week. The action should pick up tomorrow. These numbers should be in line and the market should regain its footing. China will post retail sales, industrial production and foreign investment a week from today. I believe the number could be weak and this has the potential to be a speed bump. China's PMI was soft and further weakness in the world's largest economy would spook investors. With every passing day, the September FOMC meeting draws closer. This will keep a lid on the market and coupled with weakness in China, we could see a decline. Traders will take time off in August and the bid will be light. Profit-taking could lead to a nasty little decline. I am currently day trading and I believe the market will find its footing this week. I will not have any overnight positions. If we close below the 100-day moving average, I will sell some call spreads. This will be relatively small. Option implied volatilities are low and I don't feel like I'm being properly rewarded for the risk. If the market closes below the 200-day moving average, I will buy puts. I will be a little more aggressive with this trade. I have been successfully day trading and I don't have any reason to change my strategy. Look for stocks that are breaking through horizontal resistance after posting solid earnings. The market has been flat during the first 90 minutes of trading and we won't see much movement today. . . image

Daily Bulletin Continues...

Want Full Access?

Become a Member

Start Free Trial

No credit card required.


Previous Bulletin

August 3, 2015

Next Bulletin

August 5, 2015