January 2 , 2008
As
we wait for the market to enter into a prime entry zone for our January
trade, I thought that I would reflect on the market conditions of late.
As far as the first trading day of 2008, it was a complete downer to
the tune of 220 points to the downside. A poor ISM report and nervous
comments from the FOMC minutes aren't adding any positive marks to the
bull's cause.
In terms of economic
reports, we have Auto Sales, ADP Employment, Jobless Claims and Factory
Orders on Thursday and Nonfarm Payrolls, Unemployment, Hourly Earnings
and ISM Services on Friday -- a few of which are market moving numbers.
And if the volatility measure (VIX) wasn't high enough, add to the mix
$100/barrel crude, record high gold prices, the ever popular credit
crisis, and a slew of corporate earnings due in the coming weeks from
names like CELG, STZ, GAP, KBH, SCHN, APOL, HELE, TONS, AA, RT, MTB,
MTG, IHS, SHFL , PAY and INFY.
We are in
store for quite a volatile beginning of the year. While heightened
volatility is usually a positive environment for premium sellers
(option writers), too high a reading can make for very unfavorable risk
to reward setups. Remember the market is usually efficient at all
times, providing option writers with the right amount of compensation
for risk taken at any given moment.
Also,
our Chief Research Strategist Anthony Tsung, has authored an
informative piece entitled Waves of 2008. It is a general equity market
overview pertaining to the following topics:
- Corporate Wealth, Profits, and Tops?
- China and Ford Motor– The Big X factor
- UAE - Economics
- Agricultural Inflation—a very brief look into the popular
“Agflation”
- The Link between U.S. and everyone else in Trade
- Monetary Index – Surprising moves that go unheard
- Putting
it all Together – Bear Market is not a Recession – what the investment
public has yet to mention in public. –The other X - Factor
- Conclusion: Why a Bear Market may not necessarily be a Recession
Waves of 2008 - Click or copy and paste the following URL into the title bar of your browser to view.
http://www.indexoptiontrader.com/download/waves_of_2008.pdf