April 8, 8:46 AM


April 8, 8:46 AM

PRE-OPEN MARKET COMMENTS MONDAY - Last week the market surged through horizontal resistance and it finished 2% below its all-time high. A better than feared PMI in China sparked buying on Monday and solid domestic economic results throughout the week fueled the momentum. Earnings season will start Friday and banks will set the tone. Good news is priced into the market and dark clouds are being ignored.

 

ISM manufacturing was better than expected, but ISM services, durable goods, retail sales and ADP were light. The jobs report on Friday rebounded nicely, proving that February was a fluke. As long as domestic activity remains strong, investors will support current price levels.

 

Global economic conditions are soft and one good number from China will not turn that around. The Chinese have done all they can in the last year to stimulate growth and many traders feel that those efforts are bearing fruit. Every major economy in the world is seeing growth decelerate and this is the greatest market threat.

 

There have not been many earnings warnings and that is positive. Stocks are trading at the upper end of their valuation range and this could be the first quarter of contracting profits since 2016.

 

England will either leave without a deal or not leave it all according to Theresa May. She will meet with EU leaders Wednesday night and she is under pressure to present a new plan. Parliament can't agree on anything and this could be a train wreck on Friday (April 12th). The market is pricing in another delay. Europe is fed up with this process and they will take a hard line.

 

Trade talks with China seem to be progressing well. According to officials, 90% of the plan is in place and they are negotiating implementation and enforcement. Trump said that he will maintain current tariffs as an insurance policy - I don't believe China will be happy about that.

 

Swing traders are long the SPY around the $285.50 level. Maintain an intraday stop at $285. If the market continues higher we will continue to raise the safety net. I'm very skeptical of this rally and if we are shaken out of our long position, we are likely to go short.

 

Day traders should buy dips after support is established. We have seen late day rallies the last two weeks and that should continue into earnings announcements.

 

The path of least resistance points higher and the bid should be strong until Apple reports in a few weeks. 


April 8, 8:45 AM


April 8, 8:44 AM

PRE-OPEN MARKET COMMENTS MONDAY – We are going to keep our $3.95 offer on the IBM calls this morning. I would like to scratch them and I believe we will be able to. The stock should grind higher into earnings. We are fairly close to our LVS target and we could hit it any day. BIDU and NVDA also look good. If we are able to scratch our IBM calls I will look for another call trade. There is a reason I took profits on BA. We needed the bounce to last one or two more days. When that did not happen we needed to exit. I did not want the downside exposure we are seeing this morning. 


April 8, 8:44 AM


April 5, 1:15 PM

WE WERE ABLE TO SELL THE FB MAY (17) $180 CALLS FOR $5.80. THEY WERE BID AT 1:10 PM ET. THE NVDA MAY (17) $200 CALLS TRADED $7.35 AND WE WILL USE THAT FOR OUR FILL. YOU SHOULD STILL BE TRYING TO SELL THE IBM MAY (17) $145 CALLS FOR $3.95.  



April 5, 12:51 PM


April 5, 12:51 PM

TRADE UPDATE 1:00 PM ET - WE ARE GOING TO STAY IN STOCKS THAT HAVE FOLLOW THROUGH. I AM DISAPPOINTED WITH FB AND IBM. BOTH COULD GAIN TRACTION AT ANY MOMENT, BUT THEY FAILED TO DURING A STRONG MARKET RALLY. NVDA HAS BEEN MOVING HIGHER. I WANT TO TRY AND SCRATCH FB AND IBM AND SHIFT OVER TO NVDA. IF WE SELL EITHER CALL POSITION BUY THE NVDA CALLS AT THE MARKET. LVS AND BIDU LOOK GREAT




April 5, 12:48 PM


April 5, 9:37 AM

WE WILL USE $3.60 FOR OUR FILL PRICE ON THE BIDU JUNE (21) $200 CALLS.