Dow Archives - Options Trading Strategies for Consistent Income - OptionPundit

The Shining Asset Class – Gold

By | Technical Analysis, Trade Ideas, US Market | One Comment

Recall the post on Dec 31 on watching the Gold action. It has been closing upwards every years for the past 8 years. As of Friday’s close, Gold was up almost +7% year to date and as of this writing, it’s rising further. Attached chart shows a massive base building around $920-$940. And if Gold is to break-out based on 3 box reversal, the next logical price point is $1060, almost to earlier peak registered in 2008. That would mark either the double top, or if upside momentum is sustained, a new beginning on next Bull Run. Based on my…

Read More

What’s Next?

By | Technical Analysis, US Market | No Comments

What a day that it was. This was the largest market decline ever on an inauguration day which also qualified as a 90% down day on both the NYSE and NASDAQ. According to Lowry’s, this was also the second 90% down day in just four trading days, after a hiatus of 90% Down Days since Dec. 1. While the DJI, S&P 500 and NASDAQ all suffered sharp losses of 4%, 5% and almost 6%, respectively, S&P Mid and Small Cap or Russell 2000 Indexes fell by 6.00%, 7% and 7%. Based on yesterday’s action, the probability of a retest of…

Read More

Is Berkshire in Trouble?

By | Investment Strategy, Market Psychology, US Market, Worldwide Markets | No Comments

This 2 part series will cover recent market developments about Berkshire Hathaway, points to a strategy on how you may benefit more on the same trades he did recently and an option trading strategy that probably Berkshire uses for maximizing it returns on the underlying they find worth investing. Don’t forget to read the big picture of US stock markets. Markets are behaving pretty much that way. I am opening December portfolios for OPNewsletter, to join, pls click here. Before I proceed, I must mention that I admire Mr Buffett’s skills. I got an opportunity to meet-up face to face with…

Read More

Where are the Markets Heading?

By | Investment Strategy, Market Psychology, Technical Analysis, US Market | 5 Comments

Below charts and rough technical analysis is not to paint a grim picture but is rather an attempt to define a range for the downside. It’s better to develop trading plans with the worst case scenario in mind vs. developing plans on pure hopes and dreams. I don’t argue that equities are starting to show value and in fact I am already working to develop an OPN value portfolio design to double in next 5-6 years riding on the trends that are about to emerge in the new world post financial crisis clean-up. I think no one can time the…

Read More

DOW, S&P, Nasdaq All Up

By | Daily Report | 2 Comments

The Dow increased 4.7% closing at 8979.26, the Nasdaq was up 5.5% to finish at 1717.71, and the S&P was up 4.3% to finish at 946.43. Leading sectors Coal and Consumable Fuels +13.3%, Education Services 13.2%, Steel 13.1%, Oil and Gas Exploration 12.1%, Gas Utilities 11.4%. Gold will surely make it to the lagging sectors. Though the rally came on more than average volume, the up volume wasn’t impressive at all. The new lows also increased. Net net, poor market internals in the face of a “strong” reversal, far short of saying any strong bounce. I earlier mentioned my bias…

Read More

The Wall Street Bailout Plan- OP’s Perspective

By | Market Psychology, Technical Analysis, US Market | 4 Comments

The $700billion market bail out plan is disclosed and is for review withCongress. The Target is to get it to President table by Friday, according to Forbes. As per the same article– Treasury Secretary Henry Paulson “is in effect becoming the dictator of the American financial system for a few months, subject to congressional oversight,” said Wall Street historian John Steele Gordon, author of a book about the national debt. They are seeking unchecked power from Congress to buy $700 billion in bad mortgage investments from financial companies in what would be an unprecedented government intrusion into the markets. I hope…

Read More