Not much to write about today. The biggest news is that the NFL might review its “take a knee” policy and that as you know would overshadow any economic news. I did find headlines about the Chinese government taking an “active” role in the big Chinese internet companies and I am thinking long term that cannot be good. BABA and BIDU were both done a bit after torrid runs. My story for today is WMT because it broke the 3 day rule I just wrote about and what the heck I own it too.
That was quite a week and 2 days. Before Donald J Trump stunned the media with his election win, he was a power user of TWTR. Various reports about what he will tweet in the future are unknown to me as I write this but it is safe to say TWTR will keep buzzing with the social media malestorm he helped create. The fact that TWTR is now stuck in the popular culture is pretty hard to dispute.
Look for our webinar on fixing broken positions real soon. Looking Nov 7th.
I seem to remember this time last Wednesday when the SPX was trading just below 1900. Chinese markets were closed for a holiday week and the weak jobs number on Friday created the whipsaw we had for the last week and a 100 point rally in the SPX. Like we saw twice already since the late August debacle, the rallies were as vicious as the selloffs.
Yet we have another FOMC announcement with the Fed choosing to do nothing. I don’t know how far the economy has to grow before rates start to normalize but we have to be getting close now. We had the 90’s and a government surplus and higher rates and no one was complaining. Once again post-meeting the VIX dropped even with near sure 25 basis point rises in 2015 mapped out.
As long as one of the big 4 (EU, Japan, USA or China) is still in the QE way stocks are bound to tumble on good economic news. USA is out, China thinking and Japan and the EU are in full swing. Today the EU is reaping the benefits of tough fiscal policy and looser monetary policy with growth looking better so stocks sold off. The strange result of QE is that good news is bad news for stocks and that is the present reality. To the extent this small selloff lasts will probably be answered by the ADP number in the morning. We will probably bounce on a middling number.
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One of the most followed stocks on the NASDAQ, FB, had earnings last night. There was HUGE volume yesterday ahead of earnings and May3 weekly volatility got to 150% ATM. FB actually made a decent move by the end of the day today, moving up to near 29.00 a share. But, those who bought upside calls are probably NOT happy. Take a look at a shot of the FB May3 29 calls from yesterday.