Earnings jitters, a weaker than expected Michigan Sentiment index, and a lack of reasoning to be bullish allowed equities to creep lower for much of the day. This marks the fourth consecutive week of losses for the major indices. However, there is a bright side; the selling has been orderly. That doesn't mean that stocks won't continue to decline. In fact, we still think that the mid to low 800's are likely in the September S&P at some point in the next few weeks. However, it does suggest that investors are no longer in the same panicked state experienced in the fall of 2008.
While we have heard earnings reports from a few firms, the season will pick up pace next week. We will hear from Johnson & Johnson, JPMorgan, Google and others. Some fear that even numbers that beat expectations will fail to give stocks a lift. Nonetheless, I believe that the fact that equities spent the four weeks prior to earnings grinding lower the "buy the rumor sell the fact" disappointment may already be accounted for.
On a side note, General Motors Corporation rose from the dead today. Well...they have emerged from bankruptcy protection but many would likely argue that they still aren't showing many signs of life. CEO Fritz Henderson claims that the new GM will focus more on customers. He also mentioned a partnership with eBay in which visitors to the site will be able to purchase vehicles online via their auctioning platform. As a consumer, this doesn't strike me as being a good idea...
While we can't rule out a retest of the lows, or slightly new lows next week, our comments from yesterday are still valid:
We made a rather bold call yesterday, and today's lack of follow through was a bit disappointing. However, we are going to stick with our idea of a higher market...even if it means a retest of the recent lows before a longer lasting rally can ensue. We could be wrong, but we are looking for just under 900 in the September S&P, 500 in the Russell and 1450 in the NASDAQ.
**Seasonality is already be factored into current prices, any references to such does not indicate future market action.
S&P 500 Futures and Options Trading Recommendations
**There is unlimited risk in naked option selling and futures trading
Position Trade -
July 7th- We recommended to sell the August S&P 760 puts for $6.50 or better
Russell Futures and Options Trading Recommendations
**There is unlimited risk in naked option selling and futures trading
Position Trade -
Flat
NASDAQ Futures and Options Trading Recommendations
**There is unlimited risk in naked option selling and futures trading
Position Trade -
Flat
While we have heard earnings reports from a few firms, the season will pick up pace next week. We will hear from Johnson & Johnson, JPMorgan, Google and others. Some fear that even numbers that beat expectations will fail to give stocks a lift. Nonetheless, I believe that the fact that equities spent the four weeks prior to earnings grinding lower the "buy the rumor sell the fact" disappointment may already be accounted for.
On a side note, General Motors Corporation rose from the dead today. Well...they have emerged from bankruptcy protection but many would likely argue that they still aren't showing many signs of life. CEO Fritz Henderson claims that the new GM will focus more on customers. He also mentioned a partnership with eBay in which visitors to the site will be able to purchase vehicles online via their auctioning platform. As a consumer, this doesn't strike me as being a good idea...
While we can't rule out a retest of the lows, or slightly new lows next week, our comments from yesterday are still valid:
We made a rather bold call yesterday, and today's lack of follow through was a bit disappointing. However, we are going to stick with our idea of a higher market...even if it means a retest of the recent lows before a longer lasting rally can ensue. We could be wrong, but we are looking for just under 900 in the September S&P, 500 in the Russell and 1450 in the NASDAQ.
**Seasonality is already be factored into current prices, any references to such does not indicate future market action.
S&P 500 Futures and Options Trading Recommendations
**There is unlimited risk in naked option selling and futures trading
Position Trade -
July 7th- We recommended to sell the August S&P 760 puts for $6.50 or better
Russell Futures and Options Trading Recommendations
**There is unlimited risk in naked option selling and futures trading
Position Trade -
Flat
NASDAQ Futures and Options Trading Recommendations
**There is unlimited risk in naked option selling and futures trading
Position Trade -
Flat
