Bid Will Start To Weaken Soon – Free Trial – See the Stocks I’m Shorting

April 22, 2015
Author: Peter Stolcers, Founder of OneOption

If you want to see what I'm trading today - take the FREE TRIAL Posted 9:30 AM ET - Yesterday, the market opened higher and it was not able to hold the gains. Facebook will announce after the close today and Google/Microsoft will post after the bell tomorrow. Apple will release earnings on Monday. Once these mega cap tech stocks have posted results, I believe the enthusiasm will wane. Flash PMI's will be posted tomorrow morning. China will be weaker than expected, but traders won't get spooked because the PBOC is easing. They lowered bank reserve requirements 100 basis points earlier in the week. Europe will come in slightly better-than-expected, but growth is still meager (below 1%). Sluggish global activity will spark profit-taking and domestic Q1 GDP next Wednesday could be the catalyst. Many analysts expect dismal growth of 1%. Before the open tomorrow, a number of industrial companies will post results (MMM, CAT, DHR, IR, JCI, NUE and RS). Soft global demand and a strong dollar will weigh on profits. This round of earnings could be the first sign of trouble. Stocks are trading at a rich forward P/E of 18 and there is room for profit-taking. May is a seasonally weak period for stocks. Greece needs to secure huge loans in the next two months and the rhetoric is heated. Asset Managers don't fear missing the next big rally. Once the mega cap tech stocks post, the bid will weaken. We are at the upper end of the range and profit-taking will begin. I am not looking for a massive decline, but we should test the 200-day moving average in May. I bought a few puts yesterday in retail and energy. I will add if we close below SPY $209 today. The market is only 25 S&P points above the 100-day moving average. It doesn't have to move far to break major technical support and I will stay relatively passive until we close below it. Don't jump the gun; we still have a few big earnings releases to get through. Facebook will probably post a good number today. If you want to see what I'm trading, take the free trial or sign up for 10 symbols. . . image

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