| |
| |
|
|
|
|
|
|
Oil and Gasoline Price Uncertainties
The Light Crude Continuous Contract hit an all-time high at $70.85 a barrel, while Unleaded Gasoline Futures spiked 50% or $1 a gallon on Tuesday. However, oil closed the week at $67.57 a barrel, while gasoline finished the week up 15%. There's still uncertainty over the extent of oil and gasoline disruptions in the Gulf, over the next few weeks or months, caused by hurricane Katrina. However, there are many forces keeping a lid on oil and gasoline prices. The summer driving season ends after Labor Day. President Bush urged Americans to conserve gasoline. Many Americans canceled driving plans for the Labor Day weekend, because of price spikes in retail gasoline. There were thousands of complaints about price gouging at gas stations last week. European governments are shipping oil and refined products to the U.S. The U.S. government opened the Strategic Petroleum Reserve, to oil firms, and suspended restrictions on regional gasoline standards. The strong U.S. economic expansion has been slowing, and may continue to slow in coming months. Oil and gasoline may have hit short-term tops on Tuesday, while it seems oil stocks had "blow-off" tops (opposite of capitulations) Wednesday and Thursday. Consequently, oil stocks may be in a volatile range over the next few weeks, along with the stock market in general. The first chart below is an OIH weekly chart. Last week, OIH, an oil ETF (i.e. basket of oil stocks) traded between 112 and 122. I suspect, the volatile trading range will continue, while oil stays in the $60s. OIH has major resistance in the low 120s and major support in the low 110s. So, there may be excellent opportunities to trade OIH options (or options on other oil stocks) next week. The second chart is an SPX daily chart. There's significant short-term support around 1,200 (i.e. psychological support, 200 day MA, and Parabolic SAR buy signal). Last week, 1,225 was resistance. If SPX holds 1,225, it may trade up to 1,245 (recent high), and 1,253 (multi-year Fibonacci level). However, SPX has open gaps at 1,174, 1,143, and 1,138. September options expire in two weeks. Some current September Max Pain expirations are: SPX 1,220 with the value of calls 150% more than the value of puts (which is bearish, because the put/call is a contrarian indicator). SPX closed at 1,218. OEX 565 with the value of puts 130% greater than the value of calls (which is bullish). OEX closed at just over 563. QQQQ 39 with the value of puts 15% more than the value of calls. QQQQ closed at 38 3/4. Volatility normally picks-up two weeks before options expiration. Economic reports next week are: Mon: None (market closed for Labor Day), Tue: Revised Productivity, and Fed's Beige Book, Wed: Unemployment Claims, and Wholesale Inventories, and Fri: Export & Import Prices. Also, in September, the FOMC meeting, earnings warnings, and end-of-the-quarter window dressing should influence the market. The uncertainty of oil and gasoline prices, and economic data, caused by hurricane Katrina should contribute to volatility over the next two weeks. The stock market may continue to consolidate, short-term, until earnings warning season in late September, and third quarter earnings in October. Charts available at PeakTrader.com Forum Index Market Overview section. Arthur Albert Eckart is the founder and owner of PeakTrader. Arthur has worked for commercial banks, e.g. Wells Fargo, Banc One, and First Commerce Technologies, during the 1980s and 1990s. He has also worked for Janus Funds from 1999-00. Arthur Eckart has a BA & MA in Economics from the University of Colorado. He has worked on options portfolio optimization since 1998. Mr Eckart has developed a comprehensive trading methodology using economics, portfolio optimization, and technical analysis to maximize return and minimize risk at the same time. This methodology has resulted in excellent returns with low risk over the past four years.
MORE RESOURCES:
Investing - Google News |
|
|
|
RELATED ARTICLES
Trading Expert Discovers Ways To Beat Stock Market Odds With Money Management The first point to mastering money management is that you have to understand when you're trading on the stock market is that you are playing the odds - but unlike many forms of gambling, you can make money. The key to making this money is to respect the risk that is part of the market, and manage it. Easily Finding A Good Stock There is a tremendous amount of software, complicated high priced newsletters, radio and TV stock pickers and Internet web sites that will help you find a stock that is going to make you rich.The problem is you don't know if this is talk or are these gurus putting their own money where their mouth is. Trading Baskets Part I Q. What is a basket?A basket is a group of up to 50 stocks that you can trade, manage and track as one entity. Day Trading Strategy or Stock Trading Software? The Way You Pick Stocks Affects Your Results The trading method you employ to approach the stock market can make a big difference in your results.Stock trading is a very competitive field and in order to succeed you need to FOCUS on a set of simple strategies that you can implement without hesitation. Creating Wealth by Gearing Up Gearing is where you borrow money to invest. As already mentioned, it is best to clear all your debt before looking at investment. Powerful Options Basics Lessons Improving your trading in 180 days. An option is a traded security that is a derivative product.By derivative product we mean that it is a product whose value is based upon or derived from the price of something else. Investing Offshore for Retirement As an expatriate you are in a privileged savings and investing position. Make the most of the options available to you while you can, consider investing offshore for your retirement. What If You Absolutely Positively Could Not Lose - Would You Play the Stock Market? Seniors on fixed incomes face a unique problem. Where do they invest their savings to get maximum return on investment with limited risk? Some of the traditional places like CDs and Treasury Notes are extremely safe, however the yields tend to be very low. How to Choose the Right Share Class You'll want to opt for the no-load or institutional share class instead. If you're a no-load investor who is determined to buy a fund that's primarily broker-sold, go through a supermarket and opt for the D shares. Investing and the Fear of Regret and Greed People tend to feel sorrow and grief after having made an error in judgement.Investors deciding whether to sell or buy a security are typically emotionally affected by whether the security was bought or sold for more or less than the current price. How To Create Wealth In The Stock Market First and foremost, an opportunistic strategy for creating wealth in the stock market is needed. And the opportunistic strategy for creating wealth in the stock market must have two ingredients, a plan and a goal. Consolidation Period The economic data reported Fri showed continued above trend growth with disinflation (at the core level, excluding food and energy) in the second quarter. Real output growth has slowed from about 4% in 2003 & 2004 to just over 3 1/2% so far this year, while a core inflation rate fell from 3% last quarter to 2%. Trading Systems A trading system consists of a set of rules for viewing markets and making trades. The advantages of trading systems can be hidden when they become associated with trading platforms involving trade order submission and processing. Buying Florida Investment Properties and Where Its Hot Relaxing in Style: Florida Investment PropertiesIn Florida, relaxing in the sun and sand is a way of life. There's no better way to experience a slice of Florida living than buying your own space. Your Worst Enemy To Successful Investing - The Media How do you make your investment decisions and where do you get your information? If you're like most of the people I know, you look to the experts.That's fine, however it's important to be aware that for every expert, there's an opinion and for every opinion there's an expert. My Way Or The Highway: Give Your Financial Professionals A Good Talking To! All this talk about Investing is encouraging lately. Over the last few years, more people have become interested in the duty to invest there money, then ever before. Caveat Emptor: You May Owe Taxes Despite 401(K) Losses! One among many ways you lose money in non-indexed mutual funds is the tax trap. You may have to pay taxes even when your mutual fund loses money! To many people this is painfully unexpected. Trading Tips No 4: Technical Analysis The Holy Grail Syndrome Everyone knows that the Holy Grail of investing and trading is a myth. Finding a good technical analysis tool that will give you a trading system that wins all the time is called the holy grail of trading. Seecrets on Investment: Tired of Making Huge Losses in the Stock Market - Part 1 Over 80% of all individual investors lose money in any given span of ten years. This figure is likely to be higher, given most people's reluctance to reveal their losses. Is a SEP Plan Right For Your Business A SEP is a special type of IRA. Under a SEP plan the employer creates an IRA account for each eligible employee, hence the name SEP-IRA.
|
| home | site map |
| © BullMarketData.com 2008 |
