Market Overview

Sang Lucci December 11th Watchlist


Major newswires are all citing optimism on fiscal cliff talks and FOMC anticipation as the reason for the gap up this morning in the broad indexes, although no real news has surfaced on any actual plans. The White House decided not to issue any comments over Boehner's visit to speak directly with President Obama. I think this may stop the incessant news algos running amuck in the markets and pushing indexes up/down significant amounts in fractions of seconds. With less volatility though, you can expect more chop type action and a slow grind higher. This makes for bad options pricing and difficult trading.

Financials are looking strong this morning with all the major investment houses gapping higher. Goldman Sachs is one to keep in mind because she hasn't quite joined the bulls yet. She may take the role of the laggard and make a move today.

We don't have much by way of economic news this morning and most traders are waiting patiently for the FOMC minutes to hit the street tomorrow afternoon. The trend seems to be 'buy in anticipation' these days and you can see this by looking at the slow push higher in equity prices across the board. This type of price action makes things a bit difficult for options traders because the overall sentiment and conviction remains low. This, in turn, drags on options pricing even if your stock is moving in the direction that you want it to.

I'll be watching Amazon (AMZN) for most of the morning and babysitting my overnight short position, making sure it doesn't go too far against me before I book profits.


The preceding article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

Posted-In: Economics Markets Trading Ideas


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