Market Outlook Week 3 September
Welcome to the 3rd week of September!
Wait! Why am I calling this the 3rd week of September when this is clearly but the 2nd full week of September? That's because, as an options trader, I count my weeks based on the regular options expiration calendar. Regular options expires every 3rd Friday of the month, as such this week is the week of the 3rd Friday of the month, hence the 3rd week of the month for me.
However, this Friday is a very special expiration Friday. It is not only the expiration Friday for regular equities options, but also options on futures, index futures and Single Stock Futures as well. As such, there is a very special term for such a day, called "Quadruple Witching" day, a day which occurs only 4 times a year when multiple derivative instruments expire on the same day. (Read about Quadruple Witching)
So, what is the effect of such a day?
Well, when derivatives expire, they increase the trading of the underlying equities, spiking the trading volume in the market but they are not historically known to be market moving. In fact, its usually just a very narrow trading day with HUGE volume. As such, nothing to worry about.
Last week, the market took short term profits as I have expected and the market closed with the week negative. This left alot of investors and traders feeling very uncertain, as reflected in the bond yields that barely nudged and total equities put call ratio staying in the uncertain zone. However, this is actually a POSITIVE sign!
Why is that a positive?
Well, because the market did close a pretty negative week but investors and traders were only at most "uncertain" rather than all out bearish like real negative weeks. This makes the possibility of a rebound and a resuming of the bull run a very high probability event this week onwards. In fact, looking at the weekly charts, I really like how both the S&P500 and the Dow stopped right on top of their respective weekly 10MAs, which is usually a pattern that sets up a rebound.
We hope to see confirmation of this rebound today, Monday. In fact, the pre market futures are already pointing strongly positive. Even though that has little to no correlation to how the day will end, it does give a feel of the sentiment at this point in time and it definitely supports my outlook.
Are you prepositioned to profit from such a move? If not, you really need to join me and profit with me for just $1 now! In fact, if you had only trade 1 miserable contract of every of my recommendations this year, you would have made $1,393.00! Take a look:
For now, the market remains in short term and intermediate neutral trend within a primary bull trend.
Have a VERY profitable week ahead!
Wait! Why am I calling this the 3rd week of September when this is clearly but the 2nd full week of September? That's because, as an options trader, I count my weeks based on the regular options expiration calendar. Regular options expires every 3rd Friday of the month, as such this week is the week of the 3rd Friday of the month, hence the 3rd week of the month for me.
However, this Friday is a very special expiration Friday. It is not only the expiration Friday for regular equities options, but also options on futures, index futures and Single Stock Futures as well. As such, there is a very special term for such a day, called "Quadruple Witching" day, a day which occurs only 4 times a year when multiple derivative instruments expire on the same day. (Read about Quadruple Witching)
So, what is the effect of such a day?
Well, when derivatives expire, they increase the trading of the underlying equities, spiking the trading volume in the market but they are not historically known to be market moving. In fact, its usually just a very narrow trading day with HUGE volume. As such, nothing to worry about.
Last week, the market took short term profits as I have expected and the market closed with the week negative. This left alot of investors and traders feeling very uncertain, as reflected in the bond yields that barely nudged and total equities put call ratio staying in the uncertain zone. However, this is actually a POSITIVE sign!
Why is that a positive?
Well, because the market did close a pretty negative week but investors and traders were only at most "uncertain" rather than all out bearish like real negative weeks. This makes the possibility of a rebound and a resuming of the bull run a very high probability event this week onwards. In fact, looking at the weekly charts, I really like how both the S&P500 and the Dow stopped right on top of their respective weekly 10MAs, which is usually a pattern that sets up a rebound.
We hope to see confirmation of this rebound today, Monday. In fact, the pre market futures are already pointing strongly positive. Even though that has little to no correlation to how the day will end, it does give a feel of the sentiment at this point in time and it definitely supports my outlook.
Are you prepositioned to profit from such a move? If not, you really need to join me and profit with me for just $1 now! In fact, if you had only trade 1 miserable contract of every of my recommendations this year, you would have made $1,393.00! Take a look:
For now, the market remains in short term and intermediate neutral trend within a primary bull trend.
Have a VERY profitable week ahead!
posted by Jason Ng at 3:31 AM
0 Comments:
Post a Comment
<< Home