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01/11/11 Market Update - It's All About The iPhone.....Again

|Includes: AAPL, ORCL, QQQ, SPY, T, Verizon Communications (VZ)
Market Update:
The market was fairly quiet yet again today posting meager +0.3% gains across the board.  .  The news-dominator was the “Verizon to offer iPhone” release.  Verizon (VZW) and AT&T (NYSE:T) sold hard on the news both closing down -1.5%.  Even Apple (NASDAQ:AAPL) was down today (say it ain’t so……but it is true) -0.24%.  I thought it was illegal for APPL to close in the red.  Hmmmm.
 
Wholesale inventories released today reflected a -0.2% drop for the first time in 11 months.  For reference, expectations were for a rise of +1.0%.  Small business optimism also dropped to 92.6 form 93.2 in the previous month.    
 
Areas of support remain unchanged at S&P 1260, 1250, 1225ish, and ultimately at 1175.  Resistance remains at S&P 1280 and 1300. 

BookingAlpha Update:
A QQQQ Put spread was undertaken today in light of the over-extended market.  The Q’s have been the strongest of the indexes and due to the potential of continued strength, a fairly conservative Put Spread was deployed using Jan options.  The market can continue to rally from here before the Put spread is threatened and begins losing money; which is the kind of trade we prefer.  Basically, we can be wrong and the market can continue to rally (a little) and still make a nice profit on the spread.  A beautiful thing.
 
The SPY Iron Condor became complete with Friday’s non-filled trades executing yesterday morning.  Confidence is high with the trade structure as the market is feeling a little tired at the top of the recent range and a very comfortable cushion exists with the Put Spread leg of the trade. 
 
The existing fully hedged ORCL position is holding well at the $31 level.  In a perfect world, for our existing trade structure that is, the stock would close right here next Friday at Expiration.  But life isn’t that easy so we continue to monitor the position ready to make any necessary adjustment if and as required.