Market Will Be Flat – Focus On Individual Stocks – Take the Free Trial

April 13, 2015
Author: Peter Stolcers, Founder of OneOption

I am offering a FREE TRIAL and you can see every new trade signal for every stock. Use the tactic I describe below to find trades. CLICK HERE TO REGISTER Posted 10:10 AM ET - Last week the market rallied from the low end of the range to the high-end of the range. It closed above minor resistance at SPY $210 and it is within striking distance of the all-time high. The gains from this point forward will be hard-fought. China posted weaker than expected trade numbers. Their market rallied and potential easing by the PBOC is keeping buyers engaged. Tonight they will post industrial production and retail sales. These numbers will also be soft, but the market won't care. Domestic economic releases are very light this week. The focus will be on earnings season. The strongest companies post early in the cycle and we could challenge the all-time high next week. Many analysts suggest that bad news is priced in. I disagree. The market is near an all-time high and stocks are trading any rich forward P/E of 18. How is bad news priced in? Energy stocks have bounced quickly and they feel a little over-extended. I believe they are due for a pullback. Resistance is strong at the all-time high and we will see profit-taking in the next few weeks. As earnings season unfolds, guidance will weigh on the market. Minimum wage increases will bite into profits and so will the strong dollar. Consumption has been sluggish. Greece is teetering on default and the rhetoric remains antagonistic. The EU is ready to cut them loose. I believe the initial market reaction will be negative, but this could be bullish on a longer-term basis. It will demonstrate that EU members need to remain fiscally responsible. The credit risk should be contained and this default will not take anyone by surprise. I sold out of the money put credit spreads last week and those positions are in great shape. Another day or two at this level and I will be buying them back for pennies on the dollar. If the SPY falters, I won't hesitate to buy them back now. I will not let my profits slip away in this choppy market. It is very important to focus on individual stocks when the market is trapped in a range. Transportation stocks, Chinese stocks, energy and tech have provided excellent opportunities. I have been looking for stocks that pulled back and found support. When a buy signal is generated by my trading system, I sell out of the money put credit spreads (bullish put spreads) or I buy calls if the implied volatilities are cheap. Take the free trial and try out my system. Look for a boring week and a fairly tight range on the S&P 500. . . image

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