January 27th, 2010
Carley's new book, "A Trader's First Book on Commodities" is now available at all major book outlets!
No surprises with Fed Funds policy
As expected, the Federal Open Market Committee voted to leave overnight interest rates unchanged at approximately 0%. In addition, the Fed didn't throw any curve balls in regards to peripheral policies and programs. They confirmed that the Mortgage Backed Securities purchases would expire at the end of March and reminded the markets that the infamous TALF will soon come to an end. Last but not least, they continue to pledge that interest rates will remain low for an "extended period". That said, at least one member (Hoenig) was against keeping the "extended period" statement.
All in all, the Fed offered a positive outlook on the health of the economy. They note that the economy continues to "strengthen" and deterioration of the labor market is "abating". They also note that inflation is likely to be "subdued for some time".
Shares of Apple lifted the NASDAQ higher after CEO Steve Jobs introduced the new iPad. At $499 it was created to compete with Kindle and according to the tech giant is more "intimate" than a laptop.
The major indices have been beaten down in recent days, but what goes up must come down and vice versa. Assuming that the State of the Union Address doesn't give the market a dose of reality, we are looking for an eventual bounce from current or moderately lower levels.
1077 marks critical support in the March S&P futures, with the next significant area at 1061. However, for now we believe that the mid-to-high 70's will hold. Resistance will be found at 1100 but we think that the upswing will eventually see the low 1120's.
Similarly, the Russell appears to be holding our 608ish support and could be headed higher. We see resistance near 628. The NASDAQ could see the 1855ish area on a short covering rally.
* Due to time constraints and our fiduciary duty to put clients first, the charts provided in this newsletter may not reflect the current session data. However, market analysis and commentary does. Charts provided by Track 'n Trade, Gecko software.
**Seasonality is already be factored into current prices, any references to such does not indicate future market action.
Please note: A mini S&P chart is used because it is better for charting purposes, but trade recommendations can be applied to either the full-sized S&P or the mini. Unless otherwise noted, profit and loss will be based on the mini version.
S&P 500 Futures and Options Trading Recommendations
**There is unlimited risk in naked option selling and futures trading
Position Trade -
January 21 - Our clients were advised to sell the March S&P 1000 puts today following the drop in an attempt to capture the market volatility in the put premium. Fills were coming in from $8 to $9.
Russell Futures and Options Trading Recommendations
**There is unlimited risk in naked option selling and futures trading
Position Trade -
Flat
Please note: A mini-NASDAQ chart is used because it is better for charting purposes, trade recommendations will denote whether a mini or full sized contract should be used.
NASDAQ Futures and Options Trading Recommendations
**There is unlimited risk in naked option selling and futures trading
Position Trade -
January 27 - Buy 1 e-mini NASDAQ near 1781
Carley Garner
Senior Analyst / Commodity Broker
DeCarley Trading
1-866-790-TRADE
Local : 702-947-0701
http://www.decarleytrading.com/
http://www.commodityoptionsthebook.com/
*Due to the volatile nature of the futures markets some information and charts in this report may not be timely.
There is substantial risk of loss in trading futures and options.
Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.
