Market Soapbox 09/16/05
Resistance: DJIA 10750; SP500 1250; Nasdaq 2200; NDX 1625
Support: DJIA 10250 ; SP500 1200 ; Nasdaq 2050; NDX 1535
Today's SOOHEY PIG PIG award goes to me, for letting the pig have a quiet day in its poke.
Monday a split tape day DJIA +4, Tues, a down day with AUTHORITY DJIA -85. Wen, a follow through down day DJIA -53. Thurs, up & down with weak internals, DJIA +13.
Today, an up day on higher volume DJIA +83 @ 12:18PM EST. Airlines, basic materials, banking & financial up, gold bugs roared +4.4%, homebuilders & semi mfg sold off.
European markets up & Asian markets down. Dollar up vs. Yen; down vs. Euro , XAU +3.47% & gold up nicely, XOI up & oil down, commodities & bonds down.
Crude oil continued its pull back to under $63, this sparked a rally in which the RUT & XAU outperformed. Contra trend: the dollar and gold continue to rise together as bonds sell off.
Bond prices are still falling with the 10 year yield increasing to 4.25%. The gap between 5 & 10 year notes stands at 21 basis points.
Theres something afoot with gold and the dollar, I can't quite put my finger on it, but it smells mighty peculiar and is acting real suspicious.
Speaking of suspicious, after our blown call last Friday, I told a good friend on Monday that the SOX would fall to 473 by this Friday. He asked why and I explained.
After last weeks rush to Semi's, last Friday the SOX closed at 482.16. There was open interest of over 3000 call options between 472 and 482 vs. 325 put options in the same range.
This week, the SOX managed to fall to 472.70 by options expiration today, making whatever of those 3000 calls that had not been sold earlier this week, worthless. This made me look good.
Using the same max pain logic, the XAU might have come down to 94 by COB today. Why? Because there was open interest of over 13,000 calls between vs. 4500 puts from 95 to 103. A slide to 94 would drop 13,000 options to zero.
This week the XAU managed to go up over 106 making most of the open interest on calls pay handsomely. All while the dollar went up along with gold.
In fact, look at the distribution on almost any ticker and the equity hit max pain and in most cases did it during options expiration week.
And if you think Sept XAU options made money, just take a look at October's open interest call vs put distribution on the XAU. Sniff, sniff.
We take it day by day and keep our eyes peeled to the sky, because it could be a name brand that pancakes us. Just my opinion, I could be wrong.
Support: DJIA 10250 ; SP500 1200 ; Nasdaq 2050; NDX 1535
Today's SOOHEY PIG PIG award goes to me, for letting the pig have a quiet day in its poke.
Monday a split tape day DJIA +4, Tues, a down day with AUTHORITY DJIA -85. Wen, a follow through down day DJIA -53. Thurs, up & down with weak internals, DJIA +13.
Today, an up day on higher volume DJIA +83 @ 12:18PM EST. Airlines, basic materials, banking & financial up, gold bugs roared +4.4%, homebuilders & semi mfg sold off.
European markets up & Asian markets down. Dollar up vs. Yen; down vs. Euro , XAU +3.47% & gold up nicely, XOI up & oil down, commodities & bonds down.
Crude oil continued its pull back to under $63, this sparked a rally in which the RUT & XAU outperformed. Contra trend: the dollar and gold continue to rise together as bonds sell off.
Bond prices are still falling with the 10 year yield increasing to 4.25%. The gap between 5 & 10 year notes stands at 21 basis points.
Theres something afoot with gold and the dollar, I can't quite put my finger on it, but it smells mighty peculiar and is acting real suspicious.
Speaking of suspicious, after our blown call last Friday, I told a good friend on Monday that the SOX would fall to 473 by this Friday. He asked why and I explained.
After last weeks rush to Semi's, last Friday the SOX closed at 482.16. There was open interest of over 3000 call options between 472 and 482 vs. 325 put options in the same range.
This week, the SOX managed to fall to 472.70 by options expiration today, making whatever of those 3000 calls that had not been sold earlier this week, worthless. This made me look good.
Using the same max pain logic, the XAU might have come down to 94 by COB today. Why? Because there was open interest of over 13,000 calls between vs. 4500 puts from 95 to 103. A slide to 94 would drop 13,000 options to zero.
This week the XAU managed to go up over 106 making most of the open interest on calls pay handsomely. All while the dollar went up along with gold.
In fact, look at the distribution on almost any ticker and the equity hit max pain and in most cases did it during options expiration week.
And if you think Sept XAU options made money, just take a look at October's open interest call vs put distribution on the XAU. Sniff, sniff.
We take it day by day and keep our eyes peeled to the sky, because it could be a name brand that pancakes us. Just my opinion, I could be wrong.
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