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

“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,, 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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