The World Awaits

Twas the night before Christmas, and all through the house the world awaits how the United States will avert what our President calls "dire circumstances". We've all heard the news, and read the analysts, and all of us have an opinion. And it's showing almost perfectly in the stock market, which precedes the economy. By 3 p.m. the market had moved from 8156 as a low to 8345 as a high, and continued to whipsaw in the last hour, in tight trading, showing the uncertainty of the investor, institutional and individual. No one knows what will happen, what to do, or even why it is happening.

President Obama:

“Economists from across the spectrum have warned that if we don’t act immediately, millions more jobs will be lost, and the national unemployment rate will approach double digits,” Obama said.

Obama is demanding a bill on his desk before Congress leaves for the Feb. 16 President’s Day holiday. A crucial procedural vote on the Senate legislation is scheduled for tonight, with a final vote planned tomorrow. The $827 billion Senate measure must then be reconciled with an $819 billion plan the House approved on Jan. 28.

We believe the market has two way trade tendency, and it proved right yesterday. The market was volatile, but only around mild S/R lines, with the market itself unsure of how to predict what will be said, determined, and with the falseness of the money we print to to do it, will lead our future. Both were available at best buy, but able to sell. We'll hold this dual strategy, expect second buys on one, and recommend another call for today's trading.

As we recommend, note we see strong support and resistance lines, and the tendency to test bottoms again. It's an anything goes market.

We chose OTM options for yesterday's trading, because of the high risk, and took open positions. Many Level 3 and Advanced Mentoring students also emailed for entry points on more ATM issues, and successfully traded from 9.90 to 12.10 on the February 410 call. We'll begin trading in in general today.