Well, everyone is bullish. Everywhere I look, every website etc... I'm bullish as well, but on oil. 50 dma held up on the drop and is support (53.40). Lots of talk of retreat from high of 55.40, but if this were a stock, everyone would be screaming buy, buy, buy.
Let me see: slow job growth tomorrow and higher oil? Mmm. Equity bulls should not be so cocky IF that unfolds. They are of course, VXN (Nasdaq volatility) down in the gutter again. The best deal in town is long puts, and you can even slap in a few months, it's the cheapest it has been EVER. And it's not for a reason, it's because option sellers have forgotten what a volatility premium is. They are about to find out, as the chart starting to build a base and is signaling an end of the 26 month bull. Would you sell a naked put six months out at these risk premiums? Be my guest.
We have one blast possible, to 10603, now both day r2 and week r1. After that, an extreme situation has us closing the 10781 gap, but dream on if you think there is much life above that. Tight stops and good risk management until the hook is set.
Let me see: slow job growth tomorrow and higher oil? Mmm. Equity bulls should not be so cocky IF that unfolds. They are of course, VXN (Nasdaq volatility) down in the gutter again. The best deal in town is long puts, and you can even slap in a few months, it's the cheapest it has been EVER. And it's not for a reason, it's because option sellers have forgotten what a volatility premium is. They are about to find out, as the chart starting to build a base and is signaling an end of the 26 month bull. Would you sell a naked put six months out at these risk premiums? Be my guest.
We have one blast possible, to 10603, now both day r2 and week r1. After that, an extreme situation has us closing the 10781 gap, but dream on if you think there is much life above that. Tight stops and good risk management until the hook is set.
This entry was posted
on Thursday, June 02, 2005 at 6:22 PM.
