Archive for March, 2010
A Lack Of Private Sector Job Growth Will Be A Problem This Summer!
The market is extremely resilient. This morning, it was able to shoulder a dismal ADP employment index. Analysts had expected job growth in the private sector to hit 24,000 and employers actually cut 23,000 jobs. This was a huge miss and for the fourth straight month, analysts have been wrong. Government stimulus has almost run its course and it is critical that we see job creation in the private sector. Corporations have trimmed the fat and they are reluctant to add overhead when the economic recovery is fragile. For the last week, analysts have been pounding their fists on the table …
The Action Will Pick Up Tomorrow. Wait For A Breakout Or A Breakdown!
Yesterday, the market continued to grind higher. The gains were marginal and the volume was very light. We have fallen into a very tight trading range the last 10 days and the market is searching for the next catalyst. There are many economic releases this week, none greater than the Unemployment Report on Friday. The expectations are high and analysts expect to see 200,000 new jobs. The market does not want to see all of the jobs come from government spending (census and stimulus). If that is the case, the reaction will be negative. However, if the private sector starts to …
End-of Month Fund Buying and Bullish Employment Projections Have Provided A Lift!
In the last nine trading days, the market has been caught in a tight low-volume trading range. It broke through resistance at SPY 115 and now it is waiting for information. We are in what I consider to be “no man’s land”. We need to wait for a follow-through rally or a reversal. Option implied volatilities are very low and it does not make sense to sell credit spreads. The momentum has stalled and prices could go either way. Wait for the market make its next move and then buy puts or calls. My gut tells me that we are heading …
CBOE, CFE and CBSX Trading Schedule for Good Friday
CBOE, CFE and CBSX Trading Schedule for Good Friday
The PIIGS Are Lining Up Big Bond Auctions - Greece Was Just The Beginning!
Yesterday, the market posted strong early gains and it made a new 18-month high. The momentum is strong and it looked like we might have a runaway market. However, as I mentioned in yesterday’s comments, we still had to get through the bond auction. The U.S. Treasury auctioned $32 billion in seven-year notes. The bid to cover was 2.6 and yields went up. Some would argue that this is a great sign. Higher interest rates mean that the economy is recovering. Corporate profits and tax revenues would rebound in that scenario. However, this is contrary to what the Fed Chairman said …