• 657 days Will The ECB Continue To Hike Rates?
  • 658 days Forbes: Aramco Remains Largest Company In The Middle East
  • 659 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 1,059 days Could Crypto Overtake Traditional Investment?
  • 1,064 days Americans Still Quitting Jobs At Record Pace
  • 1,066 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 1,069 days Is The Dollar Too Strong?
  • 1,069 days Big Tech Disappoints Investors on Earnings Calls
  • 1,070 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 1,072 days China Is Quietly Trying To Distance Itself From Russia
  • 1,072 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 1,076 days Crypto Investors Won Big In 2021
  • 1,076 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 1,077 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 1,079 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 1,080 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 1,083 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 1,084 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 1,084 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 1,086 days Are NFTs About To Take Over Gaming?
Another Retail Giant Bites The Dust

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

Market Sentiment At Its Lowest In 10 Months

Market Sentiment At Its Lowest In 10 Months

Stocks sold off last week…

Stock Barometer

Stock Barometer

Stock Barometer

Stock Barometer is completely independent. We have never and will not ever accept compensation from any company whose stock we recommend. Our goal is to…

Contact Author

  1. Home
  2. Markets
  3. Other

Coming Out Of Expirations

6/25/2014 5:58:32 AM

Good morning Traders,

Tuesday saw some program selling coming into the market. The problem is, there was a lot of selling which suggests there are many betting on more selling here. And as you know, when everyone bets in one direction, the market tends to do the alternative.

That doesn't mean we're not working on a top, it's just a process that has to play out. Let's take a look at how our forecast from last year is playing out:

SPY Forecasting Model Chart

As you can see, our model is suggesting a move higher into July. Now a look at our cycles:

2014 10/20/40 Weeks Cycles and Seasonality Chart

The 10/1 20 week cycle low is the next big focus cycle date, given the lack of a 9 month cycle low. It's pretty common to have a low within this period. So the market, cycles and forecast are all pointing towards a move lower playing out over the next 4 months...

Looking at oil very quickly, as our call options performed very nicely - if the stock market sells off, it'll likely take oil with it:

USO/OIL: Put/Call Ratio and Open Interest Chart

This just shows the 1 month future returns tend to be negative when traders bet too heavily on call options...

As for the Qs, this positioning could be very bearish...

QQQ Timing Indicator Chart

And back to the barometer:

Daily Stock Barometer QQQ Trader - primary System Chart

I think conditions are ripe for positioning in covered calls and stock put options over the next month as we work through this overbought market. Expect some trades in our services over the weekend.

Regards,

 

Back to homepage

Leave a comment

Leave a comment