Bank Stocks Help Buoy Market

Bank stocks helped buoy the market up on Monday, and raise one of our call options 40% at www.bluechipoptions.com. They hit 67% increases yesterday, in one week of trading.

This is what moved the market back up on Monday and allowed a count of 3 to call, potentially showing more upside. However, bank stock financials are inflated with TARP and "fun and games" as each tries to match Wells Fargo profits of 3 billion. At OEX we believe that the earnings coming out beginning this week will be not so pretty to read, and that the market may consolidate on the reality of what has truly driven this 4 week upside.

After dual profits on trades on Monday yesterday we continued to have or to buy the same May option issues. We are dual trading, with more risk noted to the call, on the hedge that market euphoria can continue around earnings, at least for the short term.

Yesterday, even while fishing, I was able to personally trade the May380P for 1.25 per contract profits, and the May410C for 1.10 per contract, as we watched the market move form 8097 tops to 7862.

With the hesitancy in the S&P 500 at resistance lines we continue to think we'll see a more significant consolidation by end of week. We will list both the same put and call that we've traded successfully 4 times this week already, but with notice that calls now approach even higher risk, and could be a loss.

Several traders asked recently why we do not "project" the OEX, and instead use the Dow. The Dow holds 30 stocks, and is the bellwether of the world, despite what many traders say. It is what is watched and read worldwide for how the market is doing, and its' moves affect the market. As the Dow and the OEX move in a strong correlation we use the Dow because of the ease of finding it "in the news," "on the radio", and available, and because it tracks perfectly. If an OEX trader wanted to use our calculation model on the website to utilize only the OEX for projections, not just support and resistance lines, it's possible, but has not been studied in the same way our Dow projections (www.dowprojections.com) has been quantitively analyzed.