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Options Expiration Slamming
Leading groups were slammed hard. Typical and usual Options Expiration Racketeering. Anything in an uptrend where massive call buying was taking place was smoked. Tomorrow, they will probably vaporize some puts.
Of course, when equities were getting smoked, at the exact time of the height of the mid-day panic, the 3-year Treasuries were auctioned off at ridiculous yields once again, 250% oversubscribed.
Gotta wait and see if the 50-day holds or not the next few days...
It's a long way down from here....
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Dude, that motorcycle video was awesome (especially cuz the guy survived by flying into the truck... I ride myself so hate the death scenes)
One of the Robo girls was in the back of the truck, neat trick.
Most active decliners:
NYSE
Nasdaq
Amex
Most active gainers:
NYSE
Nasdaq
Amex
The ones that caught my attention today:
http://finance.yahoo.com/q/cq?d=v1&s=AA,LEAP,mtg,pmi,rdn,
Slammed them hard! But heavy end-of-day buying:
http://finance.yahoo.com/q/bc?s=%5EDJI&t=1d
Tomorrow we head right back up.
Leo you posted on another thread (MHFT's) a very nice compliment directed at Bill Miller. Are you a fan of 'Miller the Magnificent' or were you just pulling our legs?
What I like about Bill Miller is that he's not afraid to take concentrated bets when he has conviction. That is how he beat the S&P 500 for so many years in a row while his competitors all remained closet indexers. Of course, Bill did get smoked in 2008 but so did many other formidable investors. In terrible years taking concentrated bets means you'll underperform the major indexes and your competitors. Legg Mason stock has been steadily climbing higher and think it will continue upward as it's a well managed fund.
Didn't he own a ton of Fannie and Freddie when they went under? Oh, that's right, HE WAS FREDDIE'S LARGEST SHAREHOLDER.
Does he understand anything about the US mortgage market? Let me answer that, NO. He was on CNBC this morning touting the mortgage insurers. LMAO. Sure sign to short them.
http://money.cnn.com/2008/09/07/news/economy/shareholder_wipeout.fortune...
Excellent point. Mr. Miller also probably averaged down into losing positions based on the conviction that "one day" they will rise up again. The emperor has no clothes, and his success is owed thanks to the long-term economic uptrend of the U.S. in the past many decades. His story is just a long-term version of the kind we used to hear around 1999, where everything one touched turned to gold, at least for a year or two.
Bill Miller? Seriously? Your still talking about Bill Miller? hmmmmm, he makes money by making risky bets during a massive bull market, then gets his ass handed to him when the market turns. Quite the strategy. It sounds like every american with a mutual fund up until 2008 when mom and pop investor lost their asses just like Bill. I think that anyone with a penchant for Bill's advice should just cozy up with your entire portfolio in his hands right this minute. He has bet the farm once again during this bear market rally and crazily enough has done well....again. He wasn't smart enough to get out the first time. Has something changed?
bill miller remains quite [retardedly] bullish. http://tinyurl.com/y93ykvp 7:46 AM Jan 7th from web
in other breaking news: the orioles still suck; b-more is still a disgusting crime/STD-ridden hellhole; and the sun rose this morning.
So stick with closet indexers and pay ridiculous MERs for beta!
ILMN felt like the takeoff from the bikerider
F looks like its ready to slam a guardrail. Up 20% in 5 days a little toooo pricey.
Anyone how can explain why the dow is only down by 0.34 % when the components look like this:
http://finance.yahoo.com/q/cp?s=^DJI
Short story low volume/value green high volume/value red
MCD,WMT,PG,IBM,KFT... defensives were pretty green, not a bullish indication.IMO
They were the last to fall apart last time, but they did.
Next junker to run??
GS proppies just using some teamster's dough to make the the teamsters some easy cash to make all nice again.
Rahm told LB that he can take coin from the little guy, but not when he's in the teamsters.
Maybe FTK too.....
American Consumers--------
You are 70% of your ECONOMY!!! How can you allow these banks and your govt. to screwww you so badly day after day, while you sit behind your keyboard and do nothing to stop them?
Don't like being used like toilet paper by the banking cabals and firms like Goldman Sachs??
Then STOP doing business with them. Move your money out of the banks and OUT of the stock market...it is one, GIANT ponzi scheme that will implode any time now.
Let's band together and deliver that CHANGE that was promised, but never delivered!
yep.
After all S&P raised it's rating ... to CCC- (from SD)
There must be value there !
or what happened to ;
"The company, which operates trucks under the Yellow, Roadway and New Penn brands, said $470 million of its outstanding debt was tendered by holders, which it will exchange with 37 million common shares and about 4.3 million convertible shares. Together that will make the stakes of current shareholders virtually worthless."
Beats me. I'm out of here. Good bye ! Bye ? Buy ? BUY! BUY!!!
Could somebody explain to an economic ignoramus whats the meaning of the following phrase in a few words?
"Leading groups were slammed hard. Typical and usual Options Expiration Racketeering. Anything in an uptrend where massive call buying was taking place was smoked. "
Take a look at google.com/finance
Look at the groups, transportation, utilities etc. Say gold and miners are going up. People are buying 'calls' or the right to buy at a higher price in future. Hopefully at a lower price than the stock actually is...
Those stocks. They got clobbered. This is a way that the big investment houses can milk money out of smaller investors in the market.
Take my BAC puts... please!
So many fakeouts again today.
MTG goes from big gap up, to down 8%.
PCX gaps down big, closes up.
Gold and Silver hitting green in the morning, only to be whacked over lunch. Same with SEED.
Biofuels teased the daytraders, down up down.
What are you a news reporter for "Math 101 Times" or
a prophet?
Don't tell us what happened you parrot. Tell us what
will happen tomorrow if you have brains.
No brains = no soup for you. End of the line.
Leading groups were slammed hard. Typical and usual Options Expiration Racketeering. Anything in an uptrend where massive call buying was taking place was smoked. ??????
can somebody translate this using a few words,to an economic ignoranus?
Sure. I'll try. In options buying, you buy calls when you think the price will go up and puts when you think the price will go down. If the price falls below your call level, or strike price, your money is erased. Vice versa for puts.
It seems that some locals have a list of stocks that have been ramping lately and in which there has been many call option purchases. The powers that IS simply sold the stock, took out put options themselves or sold futures on the stocks to help the price stay down and not meet the strike.
Of course, to save face and a little bit of what's left, most of the long call guys probably sold into the market, making tons of money for the people who make these options.
If this Friday is the third Friday of the month, and there's no reason to think it isn't, then it is options expiration day. That is when all options must be sold, rolled (into next month's options- at cost...) or put up for delivery of the stocks.
These methods are akin to 4X trading desks going in and blowing out stops so they can take your money.
I hope this helps.
It did seem a bit strange today, both the FTSE and S&P coming off a little bit, and the Dow ended the day up.
Conspiracy theory - the Feds and PPT are running out of steam and it's easier to keep the Dow up as it has fewer stocks to keep pumping!
DavidC
Although the Dow didn't actually end the day up, this is a perfect example of how flawed its price-weighting is.
With S and P futures, they can control 100:1 margin.
'nuff said.
Going off topic here but need some help......where can I find free charts for futures, specifically STIRS and commodities and in particular calendar spreads for different expiries.
Apologies to Robot Trader but your readership seems most likely to cough up this info, luv your work by the way.
jonny poor boy
LQD: Sept 30 106.68, Dec 31 104.15
HYG: Sept 30 86.35, Dec 31 87.84
MBS issuance - down 20% from Q3.
Gonna be interesting to see where the financials make their money if they aren't marking up their fixed income trading portfolios or originating as many mortgages for the government.
Gilgamesh,
You're correct, I'm working with 24 hour charts and it looked as though it had finished up - now that the end of day figure has been shown, it IS down a bit.
Whoops!
DavidC
Today’s sell off actually made a little bit of sense to me in the indices. China’s massive import surge reported Sunday did a number on the energy sector but ran out of gas mid day Monday. Aside from the shaky dollar there is nothing supporting $80 oil. That plus the five cent miss form Alcoa and BAC making some unwanted headline news over the Merrill deal should have been enough to account for the beating Materials and Financials took. But then again no press is bad press right? Oh and how about that negative 36.4 billion dollar trade deficit number we got today.
I agree with Leo, right back up tomorrow. With retail sales; CPI; and initial claims due at the end of the week the news cycle has a good opportunity to turn bullish. Plus Americans have tiny attention spans…
With INTC earnings Thursday after the bell and our good friends at JPM gracious enough to schedule their earnings for market hours on expiration Friday I’d say we have a good chance for fireworks over the next few days.
"I’d say we have a good chance for fireworks over the next few days."
Not on the SPX or XLF, non. Cannot see the options/futures traders agreeing to take a loss the first month of the new year of the new decade. Market at best sideways next 3 days.
Anyone know why my DBA sold off sharply suddenly? Hardly ever happens...someone sold a big block, someone who must have so many many shares that even pennies adds up to a big profit...
"Risk Aversion"
"Deleveraging"
"Flight to Safety"
very nasty crop report that tool corn and beans down pretty hard....corn was limit down
"Tomorrow, they will probably vaporize some puts."
Sure looks like they are trying. Always love opex week hijinks.