Thursday
March 26, 2015
1-855-RWT-0008
Prepared by the good people at Random Walk, LLC. (and Scott)
Great Morning!
Closing Prices From Yesterday
Today’s Number(s)
Also at 6:30am the Chicago Fed Chairman will be speaking, but no one will be awake to hear it.
Yesterday and Today
Zoinks!
The markets took a kick in the head yesterday after the durable goods numbers came in. Throughout the day bonds got weaker and weaker exasperating the problem.
During the middle of the day oil was down because of inventory numbers, but then bounced 1.75 after it was announced Saudi Arabia told the US ambassador they were moving towards Yemen.
You see, the country Obama is trying to cut sweet heart deals with – Iran – is backing idiots pseudo-terrorists in Yemen. So Saudi Arabia is taking them out because we wont unless they become a huge problem.
But before all these fireworks started the Nasdaq took a hit because of an across-the-board selling of bio-tech stocks. People finally caught on that companies that don’t have a product, and may never have a product approved by the FDA, should not be trading for $1-$4 billion. All at once people started to sell these small bubble stocks out, and the Nasdaq fell accordingly.
So in the end the chain of selling went as follows:
Step One: Biotechs sell off forcing the Nasdaq down.
Step Two: Other Nasdaq stocks fall.
Step Three: Durable goods numbers released. They stunk, but they have stunk since October, and that has usually been a good thing as it showed no inflation which would scare down the bond market.
Step Four: Stocks initially like the durable goods orders numbers until collectively the world realized “we may not see 1% (let alone 2%) growth like the Fed has said”.
Step Five: Saudi Arabia mobilizes its troops.
TODAY
During the POT session news came out stating that Saudi Arabia was attacking militants in Yemen. Now that is action! This sent oil up $0.60 immediately and then $2.20 a few hours later.
Yesterday’s sell-off, and I don;t know how to articulate it, just felt like it wasn’t done yet. Typically after a big sell-off I am inclined to get long on the close, but this time I was a little upset I sold put spreads on the close and didn’t keep them.
Today is an important day in knowing if yesterday was real or not, but it certainly is starting to feel real.
For the last couple of weeks we have been riding long deltas until 11:35am when I reversed our portfolio delta from about + 120 to – 250. We reversed on a dime. We went home short deltas for the first time in months.
Class revolved around the actions taken yesterday.
A vote was taken and next week we are going to have a class on “What happens if your risk reversal is not working out? How do I wiggle out of it?”
POT is held each Wednesday night at 7:00pm eastern.
Contract the office at 1- 855 – RWT – 0008 for more details.
Too True To Be Funny
And they don’t even teach people how to make money with options. Go Figure.
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Attorney Stuff
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Trading is almost as much fun as black jack in Vegas, but without all the annoying distractions of free drinks, Broadway shows, gorgeous people with low morals, and free buffets. It also has about the same odds of success, so when you lose all your money you wont have to walk past a smiling pit boss. Even Bruce Wayne lost everything with options in The Dark Knight Rises, and Superman keeps his day job at the Daily Planet newspaper.
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