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Frank Fahey: Market News for the Prepared Mind: 9.11-9.18.2017

September 11, 2017


“Chance favors the Prepared Mind.” – Louis Pasteur

“Millions saw the apple fall, but Newton was the one who asked why.” – Bernard Baruch

“Panic causes tunnel vision.” – Simon Sinek

“A stock operator has to fight a lot of expensive enemies within himself.” – Jesse Livermore

“Panic is a natural human response to danger, but it’s one that severely compounds the risk.” – David Ignatius 

 

The major indexes continue remain within easy striking distance of all-time highs. There is almost palpable disbelief among the financial cognoscenti that the indexes have not had a correction. Once again I have been reminded about the perils of ignoring a trend. The trend is bullish.

A characteristic of a bull market is the markets celebrate good news while ignoring bad news. Bad news sells. As a result, purveyors of news and opinion focus on the bad news as a means to market their product. The bad news last week was impressive. Natural disasters (Hurricanes Harvey, Irma, and Jose), gas shortages, weakness in the US dollar, and an H-Bomb test by North Korea dominated the news. The Republican Party received the worst news when Nancy Pelosi and Donald Trump cut a deal. The deal removed a potential debt ceiling crisis from the equation. The bad news was not totally ignored. This litany of bad news had only a minor effect on the market.

Here is an overview of the US market behavior last week and for 2017 YTD:

Index 8-Sep Change % Weekly 2017 YTD Volatility of Index
Dow Jones Industrials (DJIA) 21797.79 (189.77) -0.86% 10.30% 12.01% (VXD)
S&P 500 (SPX) 2461.43 (15.12) -0.61% 9.97% 12.12% (VIX)
NASDAQ 100 (NDX) 5913.67 15.77 0.27% 21.59% 16.07% (VXN)
Russell 2000 (RUT) 1399.42 (14.10) -1.00% 3.12% 15.49%(RVX)
S&P 100 (OEX) 1086.98 (8.27) -0.76% 9.64% 10.761%(VXO)
Dow Jones Transportation (TRAN) 4560.87 69.74 1.55% 12.57% NA
Crude Oil (CLV7) 47.56 0.21 0.44% -11.75% 29.49%(OVX)
Gold (GCZ7) 1351.20 21.30 1.60% 17.29% 13.77 (GVZ)
CBOE Volatility Index (VIX) 12.12 1.99 19.64% NA

Data Source: OptionVue8 

Negative news was ignored by the equity markets, but it was not ignored by the VIX and other volatility products. The CBOE Short-term Volatility Index (VXST) showed the greatest reaction to uncertainty by closing at 11.29. up 2.32 or 25.86%. The front month VIX future (VXU7) contango settled at 7.91% vs. Thursday’s contango of 9.75%. Narrowing of the contango percentage shows a greater relative concern for the front month versus the second month.

Here is an overview of last week for the VIX and related products:

Indexes Ticker 8-Sep 1-Sep Change % Change
CBOE Volatility Index VIX 12.12 11.28 0.84 7.45%
VIX September Future (9/20/2017) VXU7 13.275 13.075 0.20 1.53%
VIX October Future (10/18/2017) VXV7 14.325 14.025 0.30 2.14%
VIX November Future (11/15/2017) VXX7 14.875 14.425 0.45 3.12%
CBOE Short-term Volatility Index VXST 11.29 8.97 2.32 25.86%
CBOE 3 Month Volatility Index VXV 14.69 13.99 0.70 5.00%
CBOE Mid-term Volatility Index (6 month) VXMT 16.37 15.42 0.95 6.16%
VIX of VIX VVIX 100.12 93.53 6.59 7.05%
CBOE SKEW Index SKEW 135.39 130.16 5.23 4.02%
Long VIX ETP’s
ProShares Ultra VIX Short Term Futures ETF UVXY 31.83 30.88 0.95 3.08%
iPath S&P 500 VIX Short Term Futures ETN VXX 48.52 47.68 0.84 1.76%
ProShares VIX Short Term Futures ETF VIXY 40.26 39.63 0.63 1.59%
iPath S&P 500 VIX Mid-Term Futures ETN VXZ 22.47 21.86 0.61 2.79%
Inverse VIX ETP’s
ProShares Short VIX Short Term Future ETF SVXY 76.33 77.96 (1.63) -2.09%
Daily Inverse VIX Short Term ETN XIV 79.70 73.89 5.81 7.86%

Data Source: OptionVue8 

The second week of September is light on economic reports. The only numbers of note will be on inflation and industrial production. The impact of the hurricanes may push Fed unwinding further out into the future.the future. The week winds up with consumer sentiment winds up Friday and will tally the psychological effects of both Harvey as well as Hurricane Irma. The wild cards remain North Korea and pull together a tax reform bill.

There are very few earnings announcements this week. The highlights include: United Natural Foods, Cracker Barrel, and Oracle. Confirm the date and time of any company’s earnings announcement before trading any earnings announcement strategy. The most accurate source of this information is the company’s investor relations website.

Advice to stimulate your imagination:

“Ideas come and go, stories stay.” – Nassim Nicholas Taleb

“Bull markets are born in pessimism, grow on skepticism, mature on optimism and die on euphoria.” – John Templeton 

“A point of view can be a dangerous luxury when submitted for insight and understanding.” – Marshall McLuhan

“Don’t give me timing, give me time.” – Jesse Livermore

“Freedom is what you do with what’s been done to you.” – Jean-Paul Sartre

 

Monday, September 11:

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Economic: No major announcements.

International: Japan Tertiary Index – 1:30AM.

Earnings: None meeting scan criteria.

 

Tuesday, September 12:

Economic: NFIB Small Business Optimism Index – 6:00, Redbook – 8:55, JOLTS – 10:00.

International: Great Britain CPI – 4:00 AM.

Earnings: None meeting scan criteria.


Wednesday, September 13:
Economic: MBA Mortgage Applications – 7:00, PPI – FD – 8:30, EIA Petroleum Status Report – 10:30

International Economic: Germany CPI – 3:15 AM, Great Britain Labour Market Report – 4:30 AM, Eurozone Industrial Production – 5:00 AM.

Earnings: None meeting scan criteria.

 

Thursday, September 14:

Economic: Weekly Jobless Claims – 8:30, Consumer Price Index – – 8:30, Bloomberg Consumer Comfort Index – 9:45, Quarterly Services Survey – 10:00, EIA Natural Gas Report – 10:30, Money Supply – 4:30.

International: Great Britain Retail Sales – 4:30 AM.

Other: Bank of England Announcement & Minutes – 7:00 AM.

Earnings: None meeting scan criteria.

 

Friday, September 15:

QUADRUPLE WITCHING

Economic: Retail Sales – 8:30, Empire State Manufacturing Survey – 8:30, Industrial Production – 9:15, Business Inventories – 10:00, Consumer Sentiment – 10:00, Baker Hughes Rig Count – 1:00.

International: Eurozone Merchandise Trade – 5:00 AM.

Earnings: None meeting scan criteria.


Monday, September 18:

Economic: Housing Market Index – 10:00.

International: Eurozone HICP – 5:00 AM.

Earnings: None meeting scan criteria.

 

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Frank Fahey: Market News for the Prepared Mind: 9.4-9.11.2017

September 4, 2017


“Chance favors the Prepared Mind.” – Louis Pasteur

“Dreams come true; without that possibility, nature would not incite us to have them.” – John Updike

“Hurricane season brings a humbling reminder that, despite our technologies, most of nature remains unpredictable.” – Diane Ackerman

“The obvious rarely happens, the unexpected constantly occurs.” – Jesse Livermore

“There is a profound difference between information and meaning.” – Warren Bennis 

 

The end of the month was on Thursday last week. Pundits across financial media were focused on telling investors about the impact of the first losing month in four months. Time and energy were spent on what a losing month for the indexes would portend for the rest of the year. It turns out we were able to witness a monumental waste of time, energy and breath. The only major index with negative monthly performance was the small cap laden Russell 2000.

Here are the August results:

Index 31-Aug 31-Jul Aug Change August % 2017 YTD
Dow Jones Industrials (DJIA) 21948.10 21891.00 57.10 0.26% 11.06%
S&P 500 (SPX) 2471.65 2470.30 1.35 0.05% 10.43%
NASDAQ 100 (NDX) 5988.60 5880.30 108.30 1.84% 23.13%
Russell 2000 (RUT) 1405.28 1425.14 (19.86) -1.39% 3.55%
S&P 100 (OEX) 1093.78 1088.12 5.66 0.52% 10.32%
Dow Jones Transportation (TRAN) 4481.93 4490.36 (8.43) -0.19% 10.63%
Crude Oil (CLV7) 47.10 50.17 (3.07) -6.12% -12.60%
Gold (GCZ7) 1326.70 1275.30 51.40 4.03% 15.16%
CBOE Volatility Index (VIX) 10.59 10.26 0.33 3.22% NA

Data Source: OptionVue8 

The end-of-month and end-of-week market rallies were the result of a consensus that Hurricane Harvey as an impetus to force come to an agreement on the debt ceiling increase. This view put concerns about North Korea and a government shut down in the rear-view mirror. However, North Korea’s detonation of an H-Bomb may have removed some of the investor comfort zone.

Here is an overview of the US market behavior last week and for 2017 YTD:

Index 1-Sep Change % Weekly 2017 YTD Volatility of Index
Dow Jones Industrials (DJIA) 21987.56 173.89 0.80% 11.26% 10.62% (VXD)
S&P 500 (SPX) 2476.55 34.30 1.40% 10.64% 10.13% (VIX)
NASDAQ 100 (NDX) 5897.90 75.37 1.29% 21.27% 15.52% (VXN)
Russell 2000 (RUT) 1413.52 36.07 2.62% 4.15% 15.68% (RVX)
S&P 100 (OEX) 1095.25 15.23 1.41% 10.47% 12.91% (VXO)
Dow Jones Transportation (TRAN) 4491.13 90.92 2.07% 10.85% NA
Crude Oil (CLV7) 47.35 (0.51) -1.07% -12.14% 28.97%(OVX)
Gold (GCZ7) 1329.90 33.40 2.58% 15.44% 12.73 (GVZ)
CBOE Volatility Index (VIX) 10.13 (1.15) -10.20% NA
Data Source: OptionVue8 
I am still in a summer state of mind.  There was nothing particularly noteworthy about the behavior of the VIX and related products.  The S&P 500  went up while the VIX went down.
Here is an overview of last week for the VIX and related products:
Indexes Ticker 1-Sep 25-Aug Change % Change
CBOE Volatility Index VIX 10.13 11.28 (1.15) -10.20%
VIX September Future (9/20/2017) VXU7 12.625 13.075 (0.45) -3.44%
VIX October Future (10/18/2017) VXV7 13.775 14.025 (0.25) -1.78%
VIX November Future (11/15/2017) VXX7 14.250 14.425 (0.18) -1.21%
CBOE Short-term Volatility Index VXST 7.94 8.97 (1.03) -11.48%
CBOE 3 Month Volatility Index VXV 13.59 13.99 (0.40) -2.86%
CBOE Mid-term Volatility Index (6 month) VXMT 15.33 15.42 (0.09) -0.58%
VIX of VIX VVIX 93.60 93.53 0.07 0.07%
CBOE SKEW Index SKEW 130.53 130.16 0.37 0.28%
Long VIX ETP’s
ProShares Ultra VIX Short Term Futures ETF UVXY 28.94 30.88 (1.94) -6.28%
iPath S&P 500 VIX Short Term Futures ETN VXX 46.17 47.68 (1.51) -3.17%
ProShares VIX Short Term Futures ETF VIXY 38.35 39.63 (1.28) -3.23%
iPath S&P 500 VIX Mid-Term Futures ETN VXZ 21.65 21.86 (0.21) -0.96%
Inverse VIX ETP’s
ProShares Short VIX Short Term Future ETF SVXY 80.31 77.96 2.35 3.01%
Daily Inverse VIX Short Term ETN XIV 83.72 73.89 9.83 13.30%

Data Source: OptionVue8

U.S. markets are closed in observance of Labor Day. The shortened trading week is quiet on economic reports. Factory orders, mortgage applications, and wholesale trade highlight the balance of the week. In Europe, the European Central Bank is expected to leave their policy unchanged. Merchandise trade and industrial production dominate the economic reports to be released.

The wild card remains North Korea. North Korea carried out its most powerful nuclear test this weekend. Off-hours trading on Sunday and Monday showed a muted response. S&P 500 futures were down 6.25 or 0.35%. September VIX futures were up 6.13% or 0.775.

This week earnings announcements slow down to a trickle this week. The highlights include: Dave&Buster’s, Hewlett Packard, Casey’s General Stores, Fred’s, G-III Apparel, Korn Ferry, Barnes&Noble, Brady, John Wiley&Sons, VeriFone, and Kroger. Confirm the date and time of any company’s earnings announcement before trading any earnings announcement strategy. The most accurate source of this information is the company’s investor relations website.

Advice to stimulate your imagination:

“Ideas come and go, stories stay.” – Nassim Nicholas Taleb

“A paranoid is someone who knows a little of what’s going on. A psychotic is a guy who’s just found out what’s going on.” – William S. Burroughs

“A point of view can be a dangerous luxury when submitted for insight and understanding.” – Marshall McLuhan

“Don’t give me timing, give me time.” – Jesse Livermore

“Freedom is what you do with what’s been done to you.” – Jean-Paul Sartre

 

Monday, September 4: 

U.S. Holiday: Labor Day – Markets Closed.

International: Eurozone PPI – 5:00AM.

 

Tuesday, September 5: 

Economic: Factory Orders – 10:00, Gallup US ECI – 2:00.

International: Germany PMI Composite – 3:55 AM, Eurozone PMI Composite – 4:00 AM, Eurozone GDP – 5:00 AM, Eurozone Retail Sales – 5:00 AM.

Other: Minneapolis Federal Reserve Bank President Neel Kashkari to speak at a moderated Q&A at the 1st Tuesday Speaker Series at Carlson School of Management in Minneapolis, with audience Q&A – 2:00PM, Dallas Federal Reserve Bank President Robert Kaplan to participate in a moderated Q&A session in Dallas, with audience and media Q&A – 7:00PM.

Earnings: None meeting scan criteria.

 

Wednesday, September 6: 

Economic: MBA Mortgage Applications – 7:00, International Trade – 8:30, Redbook – 8:66, PMI Services Index – 9:45, ISM Non-Manufacturing Index – 10:00, Beige Book – 2:00.

International Economic: Germany Manufacturers’ Orders – 2:00 AM.

Other: Federal Reserve Governor Jerome Powell will deliver a speech entitled “The Role of Boards at Large Financial Firms,” as the breakfast presentation during the Large-Bank Directors Conference hosted by the Federal Reserve Bank of Chicago, with audience and media Q&A, in Chicago – 9:15AM.

Earnings:

SYMBOL B/A 9/1 CLOSE AVGVOL AVG MOVE SMA 10 50% FIB
FRAN BMO $7.66 1,169,780 12.20% $7.50 $8.23
FRED BMO $6.07 1,582,650 8.04% $6.07 $6.45
HDS BMO $33.02 4,249,940 9.08% $31.73 $31.66
JKS BMO $28.52 1,099,190 6.52% $25.34 $26.44
DDC AMC $14.15 1,392,480 1.78% $14.11 $14.07
RH AMC $48.51 2,385,240 15.46% $46.53 $58.71

 

Thursday, September 7: 

Economic: Weekly Jobless Claims – 8:30, Productivity and Costs – 8:30, Bloomberg Consumer Comfort Index – 9:45, Quarterly Services Survey – 10:00, EIA Natural Gas Report – 10:30, EIA Petroleum Status Report – 11:00 Money Supply – 4:30.

International: Germany Industrial Production – 2:00 AM, Japan GDP – 7:50 PM, China Merchandise Trade Balance – 10:00PM.

Other: European Central Bank Announcement – 7:45 – AM. President Federal Reserve Bank of New York William Dudley will speak about the U.S. economic outlook and implications for monetary policy at a Money Marketeers of New York University event, with audience and media Q&A, in New York – 7:00 PM, Atlanta Federal Reserve Bank President Raphael Bostic to participate in a moderated discussion on his views on the economy at An Evening with Raphael Bostic in Atlanta – 7:00 PM, Kansas City Federal Reserve Bank President Esther George to discuss the U.S. economic outlook at the Omaha Economic Forum in Omaha – 8:15 PM.

Earnings:

SYMBOL B/A 9/1 CLOSE AVGVOL AVG MOVE SMA 10 50% FIB
BKS BMO $7.50 1,342,960 7.69% $7.55 $7.60
DVMT BMO $74.76 1,235,420 1.39% $71.63 $68.90
FCEL BMO $1.60 1,051,880 1.06% $1.49 $1.49
HOV BMO $1.88 1,450,190 7.11% $1.90 $2.06
MBLY BMO $62.67 2,519,760 2.79% $63.01 $62.99
AOBC AMC $16.52 1,107,980 7.16% $17.46 $18.73
FNSR AMC $23.19 2,779,340 11.48% $24.26 $25.50
PAY AMC $19.58 1,674,920 8.65% $19.37 $19.26
RDFN AMC $23.60 1,863,690 None $24.69 $26.39
SGYP AMC $3.01 4,299,530 3.34% $3.01 $3.48
TLRD AMC $12.15 1,564,820 22.72% $11.54 $11.62

 

Friday, September 8: 

Economic: Motor Vehicle Sales, Employment Situation – 8:30, PMI Manufacturing Index – 9:45, ISM Manufacturing Index – 110:00, Construction Spending – 10:00, Consumer Sentiment – 10:00 , Baker Hughes Rig Count – 1:00.

International: Germany Merchandise Trade – 2:00 A, France Industrial Production 2:45AM, Great Britain Merchandise Trade – 4:30 AM, China CPI & PPI – 9:30 PM.

Other: Philadelphia Federal Reserve Bank President Patrick Harker to speak on Consumer Finance Issues at New Perspectives on Consumer Behavior in Credit and Payments Markets Conference in Philadelphia – 8:45 AM.

Earnings: None meeting scan criteria.

 

Monday, September 11: 

Economic: No major announcements.

International: Japan Tertiary Index – 1:30AM.

Earnings: None meeting scan criteria.

 

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Frank Fahey: Market News for the Prepared Mind: 8.28-9.4.2017

August 28, 2017


“Chance favors the Prepared Mind.” – Louis Pasteur

“Money is made by sitting, not trading.” – Jesse Livermore

“Hurricane season brings a humbling reminder that, despite our technologies, most of nature remains unpredictable.” – Diane Ackerman

“Computers have enabled people to make more mistakes faster than almost any invention in history, with the possible exception of tequila and handguns.” – Mitch Ratcliffe

“There is a profound difference between information and meaning.” – Warren Bennis

 

The truncated, end-of-summer, version of the Prepared Mind. The weekly numbers and economic calendar are here but without commentary.

Here is an overview of the US market behavior last week and for 2017 YTD:

Index 25-Aug Change % Weekly 2017 YTD Volatility of Index
Dow Jones Industrials (DJIA) 21813.67 139.16 0.64% 10.38% 11.19% (VXD)
S&P 500 (SPX) 2442.25 16.70 0.69% 9.11% 11.28% (VIX)
NASDAQ 100 (NDX) 5822.53 31.62 0.55% 19.72% 15.52% (VXN)
Russell 2000 (RUT) 1377.45 19.66 1.45% 1.50% 15.68% (RVX)
S&P 100 (OEX) 1080.02 6.50 0.61% 8.94% 12.91% (VXO)
Dow Jones Transportation (TRAN) 4400.21 18.31 0.42% 8.61% NA
Crude Oil (CLV7) 47.86 (1.04) -2.13% -11.19% 10.28%(OVX)
Gold (GCZ7) 1296.50 6.20 0.48% 12.54% 12.63 (GVZ)
CBOE Volatility Index (VIX) 11.28 (2.98) -20.90% NA

Data Source: OptionVue8

Here is an overview of last week for the VIX and related products:

Indexes Ticker 25-Aug 18-Aug Change % Change
CBOE Volatility Index VIX 11.28 14.26 (2.98) -20.90%
VIX September Future (9/20/2017) VXU7 13.075 14.975 (1.90) -12.69%
VIX October Future (10/18/2017) VXV7 14.025 15.125 (1.10) -7.27%
VIX November Future (11/15/2017) VXX7 14.425 15.375 (0.95) -6.18%
CBOE Short-term Volatility Index VXST 8.97 13.17 (4.20) -31.89%
CBOE 3 Month Volatility Index VXV 13.99 15.65 (1.66) -10.61%
CBOE Mid-term Volatility Index (6 month) VXMT 15.42 16.38 (0.96) -5.86%
VIX of VIX VVIX 93.53 114.39 (20.86) -18.24%
CBOE SKEW Index SKEW 130.16 128.86 1.30 1.01%
Long VIX ETP’s
ProShares Ultra VIX Short Term Futures ETF UVXY 30.88 38.97 (8.09) -20.76%
iPath S&P 500 VIX Short Term Futures ETN VXX 47.68 53.20 (5.52) -10.38%
ProShares VIX Short Term Futures ETF VIXY 39.63 44.19 (4.56) -10.32%
iPath S&P 500 VIX Mid-Term Futures ETN VXZ 21.86 22.51 (0.65) -2.89%
Inverse VIX ETP’s
ProShares Short VIX Short Term Future ETF SVXY 77.96 70.66 7.30 10.33%
Daily Inverse VIX Short Term ETN XIV 81.32 73.89 7.43 10.06%
Velocity Shares Daily VIX Midterm ETN ZIV 71.57 69.68 1.89 2.71%

Data Source: OptionVue8

As August comes to a close, reports will be released for the S&P CoreLogic Case-Shiller Home Price Index, the second estimate of U.S. second-quarter GDP, motor vehicle sales, and the employment situation. Important inflation data includes PCE price indexes as part of Thursday’s personal income and outlays report. Other important data includes advance trade in goods on Monday and also home sales on Thursday. Consumer confidence on Tuesday and consumer sentiment on Friday, bring consumer psychology onto focus . Hurricane Harvey, North Korea, and the debt ceiling are in play as wild cards for the upcoming week.

This earnings season winds down this the week. The highlights include: G-III Apparel, Scansource, H&R Blockm Movado, Hain Celestial, Best Buy, Shoe Carnival, Dytech, Bob Evans Farms, Chico’s. Brown-Forman, Analog Devices, Vera Bradley, Campbell Soup, Dollar General, Oxford Industries, Genesco and Ciena. Confirm the date and time of any company’s earnings announcement before trading any earnings announcement strategy. The most accurate source of this information is the company’s investor relations website.

Advice to stimulate your imagination:

 

“A man without ethics is a wild beast loosed upon this world.” – Albert Camus

“The hurricane complicates things in that what would have been purely a business decision becomes a decision of the heart.” – Henry Cisneros

“A point of view can be a dangerous luxury when submitted for insight and understanding.” – Marshall McLuhan

“Don’t give me timing, give me time.” – Jesse Livermore

“Freedom is what you do with what’s been done to you.” – Jean-Paul Sartre

 

Monday, August 28: 

Economic: International Trade in Goods – 8:30, Dallas Fed Manufacturing Survey 10:30.

International Economic: Japan Unemployment Rate – 7:30 PM.

Earnings:

SYMBOL B/A 8/25 CLOSE AVGVOL AVG MOVE SMA 10 50% FIB
PRXL AMC $87.70 1,079,620 7.32% $87.69 $87.52

 

Tuesday, August 29: 

Economic: Redbook – 8:55, S&P Corelogic Case-Shiller Home Price Index – 9:00, Consumer Confidence – 10:00, State Street Investor Confidence Index – 10:00.

International: France GDP – 2:45 AM.

Earnings:

SYMBOL B/A 8/25 CLOSE AVGVOL AVG MOVE SMA 10 50% FIB
BBY BMO $61.87 3,803,170 14.81% $60.80   $58.15
HAIN BMO $40.40 2,422,470 4.36% $42.08 $42.40

 

Wednesday, August 30:

Economic: MBA Mortgage Applications – 7:00, ADP Employment Report – 8:15, GDP = 8:30, Corporate Profits – 8:30, EIA Petroleum Status Report – 10:30.

International Economic: Eurozone Economic Sentiment – 5:00 AM, Germany CPI – 8:00 AM, Japan Industrial Production – 7:50 PM.

Other: Federal Reserve Governor Jerome Powell will deliver a speech entitled “The Role of Boards at Large Financial Firms,” as the breakfast presentation during the Large-Bank Directors Conference hosted by the Federal Reserve Bank of Chicago, with audience and media Q&A, in Chicago – 9:15 AM.

Earnings:

SYMBOL B/A 8/25 CLOSE AVGVOL AVG MOVE SMA 10 50% FIB
ADI BMO $78.97 3,333,630 2.84% $78.94 $78.86
CTRP AMC $52.48 3,795,810 4.54% $51.71 $54.83
FIVE AMC $50.34 1,080,210 5.57% $48.80 $48.63
KEYS AMC $39.82 1,108,750 1.90% $40.56 $41.28
WDAY AMC $103.57 1,414,370 7.63% $103.27 $101.79

 

Thursday. August 31: 

Economic: Chain Store Sales, Challenger Job-Cut Report – 7:30, Weekly Jobless Claims – 8:30, Personal Income and Outlays – 8:30, Chicago PMI – 9:45, Bloomberg Consumer Comfort Index – 9:45, Pending Home Sales Index – 10:00, EIA Natural Gas Report – 10:30, Money Supply – 4:30.

International: Germany Retail Sales – 2:00 AM, France PPI & CPI – 2:45 AM, Germany Unemployment Rate – 3:55 AM, Eurozone Unemployment Rate – 5:00 AM, China PMI Manufacturing Index – 9:45 PM.

Earnings:

SYMBOL B/A 8/25 CLOSE AVGVOL AVG MOVE SMA 10 50% FIB
CPB BMO $51.40 1,594,050 4.59% $53.51 $52.88
DG BMO $77.67 3,096,050 7.41% $75.37 $75.36
MBLY BMO $63.25 2,642,620 2.79% $63.23 $62.99
TD BMO $51.94 1,261,150 0.64% $50.98 $51.16
AMBA AMC $52.98 1,018,910 8.15% $51.52 $51.58
LULU AMC $60.21 2,548,280 15.14% $59.61 $60.73
PANW AMC $128.63 1,551,780 15.43% $131.05 $133.78
RH AMC $45.43 2,441,390 15.46% $49.38 $62.44

 

Friday, September 1: 

Economic: Motor Vehicle Sales, Employment Situation – 8:30, PMI Manufacturing Index – 9:45, ISM Manufacturing Index – 110:00, Construction Spending – 10:00, Consumer Sentiment – 10:00, Baker Hughes Rig Count – 1:00.

International: Germany PMI Manufacturing Index – 3:55 AM, Eurozone PMI Manufacturing Index – 4:00 AM.

Earnings: None meeting scan criteria.

 

Monday, September 4: 

U.S. Holiday: Labor Day – Markets Closed. 

International: Eurozone PPI – 5:00 AM.

 

Tuesday, September 5: 

Economic: Factory Orders – 10:00, Gallup US ECI – 2:00.

International: Germany PMI Composite – 3:55AM, Eurozone PMI Composite – 4:00AM, Eurozone GDP – 5:00AM, Eurozone Retail Sales – 5:00AM.

Other: Minneapolis Federal Reserve Bank President Neel Kashkari to speak at a moderated Q&A at the 1st Tuesday Speaker Series at Carlson School of Management in Minneapolis, with audience Q&A – 2:00 PM, Dallas Federal Reserve Bank President Robert Kaplan to participate in a moderated Q&A session in Dallas, with audience and media Q&A – 7:00 PM.

Earnings: None meeting scan criteria.

 

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Frank Fahey: Market News for the Prepared Mind: 8.21-8.28.2017

August 21, 2017


“Chance favors the Prepared Mind.” – Louis Pasteur

“There is only one side of the market and it is not the bull side or the bear side, but the right side.” – Jesse Livermore

“I love to talk about nothing. It’s the only thing I know anything about.” – Oscar Wilde

“Computers have enabled people to make more mistakes faster than almost any invention in history, with the possible exception of tequila and handguns.” – Mitch Ratcliffe

“There is a profound difference between information and meaning.” – Warren Bennis

 

I am posting a truncated version of the Prepared Mind. The weekly numbers and economic calendar are here, but without commentary.

Here is an overview of the US market behavior last week and for 2017 YTD:

Index 18-Aug Change % Weekly 2017 YTD Volatility of Index
Dow Jones Industrials (DJIA) 21674.51 (183.81) -0.84% 9.67% 13.28% (VXD)
S&P 500 (SPX) 2425.55 (15.77) -0.65% 8.37% 14.26% (VIX)
NASDAQ 100 (NDX) 5790.91 (40.62) -0.70% 19.07% 17.85% (VXN)
Russell 2000 (RUT) 1357.79 (16.44) -1.20% 0.05% 17.76% (RVX)
S&P 100 (OEX) 1073.52 (8.28) -0.77% 8.28% 12.91% (VXO)
Dow Jones Transportation (TRAN) 4381.90 (79.25) -1.78% 8.16% NA
Crude Oil (CLV7) 48.90 (0.01) -0.02% -9.26% 27.53%(OVX)
Gold (GCZ7) 1290.30 (5.40) -0.42% 12.01% 12.12 (GVZ)
CBOE Volatility Index (VIX) 14.26 (1.25) -8.06% NA

Data Source: OptionVue8

Here is an overview of last week for the VIX and related products:

Indexes Ticker 18-Aug 11-Aug Change % Change
CBOE Volatility Index VIX 14.26 15.51 (1.25) -8.06%
VIX September Future (9/20/2017) VXU7 14.975 15.275 (0.30) -1.96%
VIX October Future (10/18/2017) VXV7 15.125 15.525 (0.40) -2.58%
VIX November Future (11/15/2017) VXX7 15.375 15.525 (0.15) -0.97%
CBOE Short-term Volatility Index VXST 13.17 15.53 (2.36) -15.20%
CBOE 3 Month Volatility Index VXV 15.65 16.39 (0.74) -4.51%
CBOE Mid-term Volatility Index (6 month) VXMT 16.38 16.86 (0.48) -2.85%
VIX of VIX VVIX 114.39 127.43 (13.04) -10.23%
CBOE SKEW Index SKEW 128.86 136.48 (7.62) -5.58%
Long VIX ETP’s
ProShares Ultra VIX Short Term Futures ETF UVXY 38.97 43.09 (4.12) -9.56%
iPath S&P 500 VIX Short Term Futures ETN VXX 13.30 13.66 (0.36) -2.64%
ProShares VIX Short Term Futures ETF VIXY 44.19 45.50 (1.31) -2.88%
iPath S&P 500 VIX Mid-Term Futures ETN VXZ 22.51 23.20 (0.69) -2.97%
Inverse VIX ETP’s
ProShares Short VIX Short Term Future ETF SVXY 70.66 71.88 (1.22) -1.70%
Daily Inverse VIX Short Term ETN XIV 73.89 74.58 (0.69) -0.93%

Data Source: OptionVue8

Janet Yellen’s Friday speech at the Jackson Hole Economic Policy Symposium will be the week’s most important event. The sector focus for the week will be Housing. FHFA House Price Index will be announced on Tuesday followed by New Home Sales on Wednesday and Existing Home Sales on Thursday. Durable Goods Orders will be will be announced on Friday prior to Janet Yellen’s speech.

This earnings season winds down this the week. The highlights include: Nordson, Toll Brothers, Cree, Medtronic, Salesforc.com, Eaton Vance, PVH, HP, Guess?, Williams Sonoma, Lowe’s, Sanderson Farms, Dollar Tree, Staples, Hormel Foods, JM Smucker, GameStop, GameStop, Ulta Beauty, Toro, and Big Lots, Confirm the date and time of any company’s earnings announcement before trading any earnings announcement strategy. The most accurate source of this information is the company’s investor relations website.

 

Advice to stimulate your imagination:

“A man without ethics is a wild beast loosed upon this world.” – Albert Camus

“The average man doesn’t wish to be told that it is a bull or a bear market. What he desires is to be told specifically which particular stock to buy or sell. He wants to get something for nothing.” -Jesse Livermore

“A point of view can be a dangerous luxury when submitted for insight and understanding.” – Marshall McLuhan

“What we learn from history is that people don’t learn from history.” – Warren Buffet

“Freedom is what you do with what’s been done to you.” – Jean-Paul Sartre

 

Monday, August 21: 

Economic: Chicago Fed National Activity Index – 8:30.

International Economic: Japan All Industry Index – 12:30AM.

 

Tuesday, August 22: 

Economic: Redbook – 8:55, FHFA House Price Index – 10:00, Richmond Fed Manufacturing Index – 10:00.

International: Great Britain CBI Industrial Trends Survey – 6:00AM.

 

Wednesday, August 23: 

Economic: MBA Mortgage Applications – 7:00, New Home Sales – 10:00, EIA Petroleum Status Report – 10:30.

International Economic: No major announcements.

 

Thursday, August 24: 

Economic: Weekly Jobless Claims – 8:30, PMI Composite Flash – 9:45, Bloomberg Consumer Comfort Index – 9:45, Existing Home Sales – 10:00, EIA Natural Gas Report – 10:30, Kansas City Fed Manufacturing Index – 11:00, Money Supply – 4:30.

International Economic: Germany PMI Composite Flash – 3:30AM, Eurozone PMI Composite Flash – 4:00AM, Great Britain GDP – 4:30AM.

Other: Jackson Hole Economic Symposium. The Federal Reserve Bank of Kansas City has hosted an annual economic policy symposium. The event is designed as a forum for central bankers, policy experts and academics to come together to focus on a topic that is not necessarily of immediate concern, but instead looks into the future at emerging issues and trends.

 

Friday, August 25: 

Economic: Durable Goods Orders – 8:30, Baker Hughes Rig Count – 1:00.
International Economic: Germany GDP – 2:00AM

Other: Jackson Hole Economic Symposium continues through Saturday. Federal Reserve Chair Janet Yellen to speak at Federal Reserve Bank of Kansas City Economic Symposium on Financial Stability in Jackson Hole.- 10:00AM.

 

Monday, August 28: 

Economic: International Trade in Goods – 8:30, Dallas Fed Manufacturing Survey 10:30.

International Economic: No major announcements.

 

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Frank Fahey: Market News for the Prepared Mind: 8.14-8.21.2017

August 14, 2017


“Chance favors the prepared mind.” -Louis Pasteur

“There is only one side of the market and it is not the bull side or the bear side, but the right side.” -Jesse Livermore

“I love to talk about nothing. It’s the only thing I know anything about.” -Oscar Wilde

“Computers have enabled people to make more mistakes faster than almost any invention in history, with the possible exception of tequila and handguns.” -Mitch Ratcliffe

“Better to have a simple model backed by excellent people than the other way around.” -Paul Carrett

 

NBSorry for the delay in posting. It always helps to hit “post.” Next week’s blog will contain on Index and VIX information. I will be in pursuit of the total eclipse.

The S&P 500 sold off 35.51 points to 2441. Last week’s 1.43% drop was the largest since November 2016. The bulk of the damage was done on Thursday when the SPX lost 1.45%. The sell-off was preceded by a market which was setting new records for lack of movement. Thursday’s skid was preceded by 58 consecutive trading sessions without a move, in either direction, exceeding 1%. This near absence of movement culminated in a record 16 straight sessions without a 0.3% move up or down. Both streaks ended with Thursday’s sell- off.

Financial talking head various blamed the ratcheting up of US-North Korea tensions and the long-legs of the current bull market. The nation’s debt ceiling limit, a statutory limit of outstanding debt obligations, needs to be raised, per the Trump administration, by September 29. Other sources are predicting a need for an increase earlier in September.

The congressional debt ceiling showdown created a crisis in 2011. It resulted in the most volatile week for financial markets since the 2008 recession. The S&P 500 was down as much as 10.6% the week of August 5. 2011. Congress will not be back inside the Beltway until September 5. Will Congress be able to reach a another bipartisan agreement in 2017? Ignore the debt ceiling negotiations at your own risk.

Here is an overview of the US market behavior last week and for 2017 YTD:

Index 11-Aug Change % Weekly 2017 YTD Volatility of Index
Dow Jones Industrials (DJIA) 21858.32 (234.49) -1.06% 10.60% 13.89% (VXD)
S&P 500 (SPX) 2441.32 (35.51) -1.43% 9.07% 15.51% (VIX)
NASDAQ 100 (NDX) 5831.53 (68.38) -1.16% 19.90% 17.77% (VXN)
Russell 2000 (RUT) 1374.23 (38.09) -2.70% 1.26% 19.59% (RVX)
S&P 100 (OEX) 1081.80 (13.62) -1.24% 9.12% 12.87% (VXO)
Dow Jones Transportation (TRAN) 4461.15 (50.81) -1.13% 10.11% NA
Crude Oil (CLU7) 48.77 (0.74) -1.49% -9.50% 28.41%(OVX)
Gold (GCZ7) 1295.70 30.90 2.44% 12.47% 13.45 (GVZ)
CBOE Volatility Index (VIX) 15.51 5.48 54.64% NA

Data Source: OptionVue8

The VIX shook off the dog days of August by closing the week at 16.04 – the highest close since November 8, 2016. The gain for the week was over 54%. The VXST – the CBOE Short-term Volatility Index – was up 81% for the week. The term structure of the front three monthly futures narrowed while gaining from 15% to nearly 37%. The number of short positions in VIX futures hit a record high the previous week. The explosion in volatility was partially fueled by traders covering short positions.

Here is an overview of last week for the VIX and related products:

Indexes Ticker 11-Aug 4-Aug Change % Change
S&P 500 SPX 2441.32 2476.83 (35.51) -1.43%
CBOE Volatility Index VIX 15.51 10.03 5.48 54.64%
VIX August Future (8/18/2017) VXQ7 15.425 11.275 4.15 36.81%
VIX September Future (9/20/2017) VXU7 15.275 12.775 2.50 19.57%
VIX October Future (10/18/2017) VXV7 15.525 13.525 2.00 14.79%
CBOE Short-term Volatility Index VXST 15.53 8.58 6.95 81.00%
CBOE 3 Month Volatility Index VXV 16.39 12.75 3.64 28.55%
CBOE Mid-term Volatility Index (6 month) VXMT 16.86 14.25 2.61 18.32%
VIX of VIX VVIX 127.43 87.39 40.04 45.82%
CBOE SKEW Index SKEW 136.48 138.32 (1.84) -1.33%
Long VIX ETP’s
ProShares Ultra VIX Short Term Futures ETF UVXY 43.09 29.79 13.30 44.65%
iPath S&P 500 VIX Short Term Futures ETN VXX 13.66 11.19 2.47 22.07%
ProShares VIX Short Term Futures ETF VIXY 45.50 37.31 8.19 21.95%
iPath S&P 500 VIX Mid-Term Futures ETN VXZ 23.20 21.19 2.01 9.49%
Inverse VIX ETP’s
ProShares Short VIX Short Term Future ETF SVXY 71.88 90.77 (18.89) -20.81%
Daily Inverse VIX Short Term ETN XIV 74.58 94.29 (19.71) -20.90%

Data Source: OptionVue8

The wild cards for the week are North Korea, the debt ceiling, and The POTUS’ twitter account. The week of August 14 brings reports on consumer spending, retail sales, housing starts, manufacturing and industrial production, as well as the minutes of the last Fed meeting.

This earnings season winds down over the next two weeks. The highlights include: Sysco, Urban Outfitters, Coach, Jack Henry, Staples, TJX, Advance Auto Parts, American Eagle Outfitters, Dick’s Sporting Goods, Home Depot, Target, L Brands, Cisco Systems, Ross Stores, Wal-Mart, Gap, Applied Materials, Estee Lauder, Footlocker, and Deere and Co. Confirm the date and time of any company’s earnings announcement before trading any earnings announcement strategy. The most accurate source of this information is the company’s investor relations website.

Advice to stimulate your imagination:

“A man without ethics is a wild beast loosed upon this world.” -Albert Camus

“The average man doesn’t wish to be told that it is a bull or a bear market. What he desires is to be told specifically which particular stock to buy or sell. He wants to get something for nothing.” -Jesse Livermore

“A point of view can be a dangerous luxury when substituted for insight and understanding.” -Marshall McLuhan

“What we learn from history is that people don’t learn from history.” -Warren Buffet

“Freedom is what you do with what’s been done to you.” -Jean-Paul Sartre

 

Monday, August 14: 

Economic: No major announcements.

International Economic: Eurozone Industrial Production – 5:00AM.

Earnings:

SYMBOL B/A 8/11 Close AVGVOL AVG MOVE SMA 10 50% FIB
JD BMO $45.90 11,189,500 6.19% $46.25 $43.85
SYY BMO $51.58 2,975,760 1.64% $52.12 $50.94

 

Tuesday, August 15: 

Economic: Retail Sales – 8:30, Empire State Manufacturing Survey – 8:30, Import and Export Prices – 8:30, Redbook – 8:55, Business Inventories – 10:00, Housing Market Index – 10:00.

International: Germany GDP Flash – 2:00AM, Great Britain CPI and PPI – 4:30AM.

Earnings:

SYMBOL B/A 8/11 Close AVGVOL AVG MOVE SMA 10 50% FIB
AAP BMO $107.34 1,854,100 4.90% $110.48 $107.27
COH BMO $47.55 2,646,440 3.02% $47.41 $47.31
HD BMO $154.88 4,747,060 1.00% $151.55 $150.11
TJX BMO $71.07 4,819,050 2.53% $70.39 $69.38
A AMC $59.33 1,908,560 2.98% $59.99 $60.03
JKHY AMC $105.74 570,145 1.56% $106.50 $106.03

 

Wednesday, August 16: 

Economic: MBA Mortgage Applications – 7:00, Housing Starts – 8:30, Atlanta Fed Business Inflation Expectations 10:00, EIA Petroleum Status Report – 10:30.

International Economic: Great Britain Labour Report – 4:30AM. Eurozone GDP Flash – 5:00AM, Japan Merchandise Trade – 7:50PM.
Other: FOMC Minutes – 3:00PM.

Earnings:

SYMBOL B/A 8/11 Close AVGVOL AVG MOVE SMA 10 50% FIB
CACI AMC $128.55 120,466 2.97% $128.29 $128.32
CSCO AMC $31.47 21,578,700 3.59% $31.56 $31.46
CTRP AMC $53.85 3,379,010 3.46% $58.07 $56.73
LB AMC $40.88 3,697,260 3.90% $43.70 $48.60
NTAP AMC $41.49 3,229,650 5.21% $42.85 $41.72
OSIS AMC $80.98 123,352 9.55% $79.70 $78.23
PRXL AMC $87.62 1,144,680 6.89% $87.55 $87.38
SNPS AMC $76.27 1,028,220 5.33% $76.50 $74.75
TGT AMC $55.65 7,721,120 6.42% $57.06 $54.62

 

Thursday, August 17: 

Economic: Weekly Jobless Claims – 8:30, Philadelphia Fed Business Outlook Survey – 8:30, Industrial Production – 9:15, Bloomberg Consumer Comfort Index – 9:45, E-Commerce Retail Sales – 10:00, Leading Indicators – 10:00, EIA Natural Gas Report – 10:30, Money Supply – 4:30.

International Economic: Great Britain Retail Sales – 4:30Am, Eurozone Merchandise Trade – 5:00AM.

Other: European Central Bank Minutes – 7:30AM.

Earnings:

SYMBOL B/A 8/11 Close AVGVOL AVG MOVE SMA 10 50% FIB
BABA BMO $151.70 17,896,800 2.83% $155.06 $150.35
HTHT BMO $99.36 254,998 4.41% $100.92 $91.84
LANC BMO $123.11 119,364 4.25% $123.07 $124.48
MSG BMO $215.66 128,323 1.25% $217.21 $205.82
WMT BMO $80.40 9,052,650 3.03% $80.71 $77.56
AMAT AMC $43.08 10,802,700 0.62% $43.56 $44.58
ATGE AMC $33.25 743,034 None $33.12 $35.25
CIB AMC $43.48 365,562 2.00% $43.70 $43.98
GLOB AMC $42.96 323,077 4.18% $44.08 $43.66
ROST AMC $55.56 3,673,540 3.02% $55.43 $54.95

 

Friday, August 18: 

Economic: Consumer Sentiment – 10:00, Baker Hughes Rig Count – 1:00.

International Economic: Germany PPI – 2:00AM.

Other: Dallas Federal Reserve Bank President Robert Kaplan to participate in a moderated Q&A session at the Dallas County Community College District Conference Day 2017 in Dallas, with audience Q&A.

Earnings:

SYMBOL B/A 8/11 Close AVGVOL AVG MOVE SMA 10 50% FIB
DE BMO $126.70 2,475,940 9.17% $129.68 $127.88
EL BMO $99.65 1,674,480 3.95% $99.94 $98.97
FL BMO $49.30 3,888,560 10.20% $48.31 $48.09

 

Monday, August 21: 

Economic: Chicago Fed National Activity Index – 8:30.

International Economic: No major announcements.

Earnings:

SYMBOL B/A 8/11 Close AVGVOL AVG MOVE SMA 10 50% FIB
BBL AMC $35.03 1,632,510 0.45% $35.92 $33.98
BHP AMC $40.35 2,557,050 0.68% $41.19 $39.15
FN AMC $41.00 567,423 4.91% $43.23 $43.94
NDSN AMC $127.68 359,855 6.35% $127.51 $124.03
PINC AMC $33.35 380,602 3.85% $34.37 $34.82
ZAYO AMC $33.82 2,066,120 2.34% $32.95 $32.13

 

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