Last weekend, in my Market Forecast, I wrote:
"For the new week, the world would likely still be watching Europe closely... Technically speak, the market seems to be waiting for a reason to rally a break higher. The resistance for SPX lies between 1290 and 1300; for Nasdaq, it is between 2750 and 2800. Financials will once again be very important. Gold seems to be ready to break higher. Oil also appears to be strong."
Well, the market started the week as expected. It pushed higher on Monday and Tuesday with SPX nearing 1280 and Nasdaq pushing towards 2730. Since the market was still range-bound, we looked at some earnings plays on Tuesday. However, the market took a nosedive on Wednesday when Italy added to worries on the European crisis. There were some bounces on Thursday, as Europe worked frantically to try to stabilize emotions and pushed for reforms. We made another earnings play (+429% on GMCR puts) using highlighting the same keypoints discussed on Tuesday. On Friday, the market rallied on leaders in Greece and Italy being replaced.
Once again, we traded lightly as the market was taking big swings. Here were the closed trades:
12:18 | HappyTrading GLD ($174.00) Sold to Close 11C172 Nov 172 calls, at $3.35 +31%
11:53 | HappyTrading WYNN ($124.00) Sold to Close 11P125 Nov 125 puts, at $5.00 +67%
11:13 | HappyTrading WYNN ($124.30) Sold to Close 11P125 Nov 125 puts, at $4.50 +50%
10:57 | HappyTrading FCX ($39.20) Sold to Close 11C40 Nov 40 calls, at $1.00 -55%
09:05 | HappyTrading AMZN ($214.20) Sold to Close 1111C220 Nov 220 calls, at $0.73 -82%
For the week, the Dow was up +170.44 points; SPX added +10.62 points; Nasdaq slid 7.4 points. Gold popped higher to trade near $1790/ounce. Oil pushed higher to $99/barrel. At the time of this writing, Asian markets were higher. Let's take a look at how the US market closed on Friday:
On Friday, SPX added +24.16 points to close at 1263.85, above its daily MAs.
Nasdaq gained +53.6 points to close at 2678.75. Its daily MAs and MACD were flat.
VIX managed to close above 30. For the new week...
To read the rest of this article, please subscribe to HappyTrading "Premium Articles" by going to the Premium Services (click here) page. If you are already a subscriber, please click here: Market Forecast 11/14/11.