Monday, June 26, 2006
The Waiting Game
Hi there Options Traders
I had a hectic weekend. Cousins wedding kept me busy most of the weekend and I felt slightly worse for wear this morning when I woke up!! Now I remember why I don't drink much anymore!!
Anyway, back to business. Not much happened in the markets today. U.S. stocks ended higher today as upbeat housing data and acquisition deals totaling around $90 billion helped distract investors from a looming Federal Reserve meeting on interest rates. Volume was light and that Fed meeting is on everybody's mind.
A rise seems certain. The question is will it be just a 0.25% rise or perhaps even a 0.5% rise and what will the Fed do in the future. If the Fed points to further concerns about inflation which require further rises then we could see some further heavy selling again so we must be prepared.
The RUT finished up again 8.5 points 6948.64. I am not concerned about the upward rise as I suspect the markets will drop after the Fed meeting. If the markets do drop they are going to drop hard so we may be glad for that extra down cushion. However I am not prepared to gamble on that outcome as the market will do what the market will do and we are not gamblers. Therefore my review point for this position of 710 remains. Once 710 is reached or passed I will see where we are and consider if any adjustments are needed.
Until next time.
I had a hectic weekend. Cousins wedding kept me busy most of the weekend and I felt slightly worse for wear this morning when I woke up!! Now I remember why I don't drink much anymore!!
Anyway, back to business. Not much happened in the markets today. U.S. stocks ended higher today as upbeat housing data and acquisition deals totaling around $90 billion helped distract investors from a looming Federal Reserve meeting on interest rates. Volume was light and that Fed meeting is on everybody's mind.
A rise seems certain. The question is will it be just a 0.25% rise or perhaps even a 0.5% rise and what will the Fed do in the future. If the Fed points to further concerns about inflation which require further rises then we could see some further heavy selling again so we must be prepared.
The RUT finished up again 8.5 points 6948.64. I am not concerned about the upward rise as I suspect the markets will drop after the Fed meeting. If the markets do drop they are going to drop hard so we may be glad for that extra down cushion. However I am not prepared to gamble on that outcome as the market will do what the market will do and we are not gamblers. Therefore my review point for this position of 710 remains. Once 710 is reached or passed I will see where we are and consider if any adjustments are needed.
Until next time.
# posted by Paul @ 5:49 PM 
