Random Walk Trading.com
Friday
March 20, 2015
1-855-RWT-0008
TM
Prepared by the good people at Random Walk, LLC.
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Closing Prices From Yesterday
Today’s Number(s)
Yesterday and Today
Yesterday
The Lord Giveth and the Lord Taketh away. After Janet Yellen’s speech on Wednesday the market took off and we rested right under all time highs. It was literally a 400 point Dow swing that day. Oil reversed from down -$1 to up $2. The Euro/Usd was down and closed up $0.03. The bonds were unchanged and closed up $2.50 (TLT).
Then yesterday bonds gave back $0.67. Oil gave back $1. The Euro/USD gave back $0.02. And the Dow gave back 117 of the Wednesday’s positive 227 ā almost exactly half. We are right back to where we started on Tuesday.
AAPL’s first day in the Dow was unimpressive. It closed down, but more because of a weak market than the stock itself.
TSLA announced it was going to do a software update in 3-4 months that makes their cars self-steering. They are going have a lot more charging stations throughout the US in the next 12 months. And their newest update is going to make accidentally running out of power impossible. So the stock falls $5.
BABA had is stock released for sale I the market to insiders, so the stock went up ā not down. This is TRULY Bizzaro World.
TODAY
I am chalking yesterday up to āthings got a little too stupid after the Fed on Wednesdayā. When I saw the Euro up $0.03 I bought put spreads in POT because I knew that was stupid. I bought put spreads in the SPX on the close because I thought it was stupid how much we swung. But I was nervous all night I might be wrong.
We should be back to normal now after what I am considering yesterday to be a day of consolidation back to normal.
There is not any economic numbers out today. All the fear of the Fed has been pushed out to September, so we will not have a BIG Fed meeting (like Wednesday’s) until July or August. So after yesterday’s selling I think we should be out of the woods and running higher. We are 300 Dow points away from an ALL TIME HIGH. The Nasdaq is a measly 8 points away from $5000.
We SHOULD be making new highs with authority as early as next week.
SIDE NOTE: I am nervous about all this nervousness, though. I suspect we will be up tomorrow. If we fall with any conviction tomorrow I am going to start getting very nervous about a BIG correction coming. We have not had one during bad news, so why not have it when there is nothing but good news?
SUMMARY
I am cautiously thinking we are going to make new highs, but I am keeping a BIG put spread (or three) priced in my head at all times so I know where to run to for my POT people.
Ā
POT is held each Wednesday night at 7:00pm eastern.
NEXT WEEK’S TOPIC:
Pricing Vertical Rolls for Rolling Risk
Contract the office at 1- 855 ā RWT ā 0008 for more details.
Too True To Be Funny
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