Asch Conformity Experiment

DeMark Says S&P 500 May Peak Above 1,250 This Week, Decline 5.6%

DeMark Says S&P 500 May Peak Above 1,250 This Week, Decline 5.6%
   
S&P 500 may advance as high as 1,254 before falling at least 5.6%, technical analyst Tom DeMark wrote in an e-mail today.

This rally should squeeze short sellers and exhaust late buying: DeMark; The rally should be fast.

DeMark's prediction last month that the S&P's decline would stop at 1,076 proved prescient, it bottomed at 1,074.77

S&P would produce sell signal today by closing above its Oct. 12 close of 1,207.25, marking 9th consecutive day the benchmark exceeded its final price four days earlier: DeMark

Close above 2-mo. high of 1,224.58 reached on Oct. 14 would "perfect" the sell setup:


-DeMark


http://seaofopportunity.blogspot.com/


*Special thanks to Option Radar, BMO Capital, MEB Options, Bloomberg, Reuters, Optionistics, LiveVolPro, CBOE, AMEX, Option Monster, T.O.P. group, and all of the options desks and traders we work with to provide the option flow! 


 No position at this time. Position declarations are believed to be accurate at time of writing but may change at any time and without notice.

Morning Note Oct 14

October 14, 2011


Equity futures are trading above fair value ahead of today's Oct Michigan Consumer Sentiment at 09:55 ET and as G20 Finance ministers are meeting in Paris today to find a solution to the debt crisis. Greece remains the central focus but fears of a spread to other Eurozone countries and banks remains high.

Morning Note Oct 3rd

October 3, 2011


US equity futures are off the worst levels of the morning following Asia and Europe lower as continuing concerns over the banking sector and slowing global growth are once again highlighted after Greece admitted over the weekend it would miss it's Fiscal targets. With no resolution in sight to the EU debt crisis, anxiety continues to weigh on markets.

Larry Williams What It Takes To Be A Winning Trader

Pro Trade in the VIX: 32ish

Trade of the Day: Halliburton September $50/$55 ratio call spread

The Trade

A trader executed the September $50/$55 ratio call spread 5,000/10,000x for a debit $.24, $240,000 total. The trade is bullish with a zone of profit potential from $50.48 to $59.52.

Total risk for the trade is unlimited or going short at $55. Maximum profit potential is $2,260,000 at $55. The above graph shows this.

A strong name in its sector with call volume nearly 2x daily average. Currently below its 200 day EMA with support near $42, but hit highs near $57 after strong earnings a few weeks ago. This is shown in the chart above.

http://seaofopportunity.blogspot.com/

*Special thanks to Option Radar, BMO Capital, MEB Options, Bloomberg, Reuters, Optionistics, LiveVolPro, CBOE, AMEX, Option Monster, T.O.P. group, and all of the options desks and traders we work with to provide the option flow!

No position at this time. Position declarations are believed to be accurate at time of writing but may change at any time and without notice.

Morning Note

August 9, 2011

US futures continue to be volatile, with Dow futures oscillating between a loss of (318) points and a gain of 324 points.

Today's main focus will be the release of the Fed statement from today's FOMC meeting, scheduled for 14:15 ET.

Treasury Auction of 3-yr notes at 13:00 ET

Greece sells €812.5M 6M T-Bills, average yield 4.85% vs prior auction 4.90%, bid to cover 3.06 vs prior 2.88

New Options Exchange in.... Iran

this article originally appeared here: 

Tehran bourse moves towards options launch

Iran’s bourse plans to expand its fledgling derivatives market by launching options in the coming months despite the cold shoulder traders have given to single stock futures.

Bloomberg TV's Cali Carlin on Bank of America demolishing foreclosed homes

Morning Note

August 1, 2011

Equity futures are trading well above fair value following the last-minute bipartisan debt agreement, although the risks of debt downgrade are still a possibility. The debt deal still must be approved by the Senate and House. A Senate vote could occur as early as this morning.


WHAT TO WATCH: The House plans votes today and the Senate may follow suit to consider the agreement reached last night to raise the debt limit by at least $2.1 trillion and slash government spending by $2.4 trillion or more. An index of U.S. manufacturing probably slipped to 54.5 in July, economists said before the ISM report at 10 a.m. The People�s Bank of China signaled it�s too early to relax monetary policy. The Reserve Bank of Australia will likely keep the overnight cash rate target at 4.75 percent tomorrow, according to a Bloomberg survey.

Options Flow Recap July 25th

Macro / Thematic

FXY CurrencyShares Japanese Yen Trust - traded over 6x its usual volume after hitting its all time high of 126.25 today.  On the NSYE, someone traded 9K Sep 124 puts on the offer @ $1.10 in an opening transaction.  The trade has a 10 IV with a 33 delta.  If this was a buyer, it looks like they are looking for some downside in the currency after clipping $126.  The trader is not the only one in the boat as the top 9/10 positions right now are in puts: Jan 110P (25K), Jan 100P (9.7K), Jan 90P (6.6K), Sep 117P (4.1K), Jan13 90P (4K), Jan 80P (3.2K), Jan 95P (3.2K).    

XLE Energy Select Sector SPDR – 15,000 of the August 80 / 77 put spread was bought for $1.22.

XLF Financial Select Sector SPDR - 59,000 of the August 15 puts were bought for $0.325.

Morning Note

*I'll update this post as I get more info up to 10 minutes before the open.

July 22, 2011

Equity futures are trading above fair value, following Europe higher after Eurozone leaders agreed a further €159B aid package to Greece to which private lenders will contribute. Three of the four options offered to lenders to swap or relend existing debts would extend Greece's repayment terms by 30 years, while the fourth would do so by 15 years. All options offer a much lower interest rate thanGreece's current 15%-25% cost of borrowing.

Options Flow Recap July 21st

Macro / Thematic

SPY SPDR S&P 500 ETF: buyer 10,000 Aug 130 puts for 1.10

 XLP Consumer Staples Select Sect. SPDR : buyer 6900 Aug 33 calls for 05

EWZ iShares MSCI Brazil Index: buyer 2,560 Sep 76 calls for 76

EWJ iShares MSCI Japan Index - 10k Sept 11 calls bot

How to Spot Unusual Options Activity by McMIllan

Delta-Neutral Option Trading Strategies

I personally don't agree with everything this guys says but figured it would helpful to some of you... 

Morning Note

*As I add to my morning note I'll try to update this post up until about 10 mins before the market so refresh or check back. 

July 21, 2011

Equity futures are now near fair value having initially followed European indices and the euro lower, after Eurogroup's Juncker said that selective default for Greece was a possibilty and after it was reported the draft EU statement for Greece proposed lowering the EFSF lending rate for Greece to 3.5% and public sector support for Greece extended for a minimum of 15 years. It was also reported that Germany and France have ruled out a bank tax as part of a deal on Greece.

HSBC July Flash China PMI 48.9 vs 50.1 sequentially.

Japan recorded an unexpected trade surplus in June, the first in three months.

Options Flow Recap July 20th

Macro / Thematic

GLD  SPDR Gold Trust - 20,000 of the August 162 / 171 call spread bought for $0.64. The trade was tied to 300,000 shares at $154.82 and appears to be to open.

VIX - 50,000 of the September 25 / 32.5 1x2 call ratio spread was bought for $0.075. The call spread traded 50,000 x 100,000.

Morning Note

July 20, 2011

Equity futures are trading above fair value lifted by strong results from Apple (AAPL) and after President Obama hailed progress on debt talks. President Barack Obama cited "some progress" in debt talks hailing a plan by a group of bipartisan senators to cut the budget deficit and raise the debt limit.

Yesterday, after the European close, the IMF called on Europe for immediate measures to strengthen the financial system through adequate capitalization and a strong follow up to the stress-test. The IMF emphasized the need to stem contagion through a cohesive and cooperative approach, noting that delays in resolving the crisis could be costly for the euro area and the global economy.

Options Flow Recap July 19th

Macro / Thematic

VIX - 19,000 of the September 16 puts were bought for $0.29.

XLE Energy Select Sector SPDR  - 32,000 of the September 83 calls were sold at $0.94. The trade appears to be to open and possibly tied to 300K shares at $77.29.