If you have been watching the price of gold lately you know that it is currently around 1,500 USD for one ounce up from around 265 USD for one ounce ten years ago. If you look at the chart for the price of gold over the past 10 years you will notice that aside from 2008 the price of gold has be steadily increasing.. Continue reading
The U.S government sued Deutsche Bank on Tuesday, May 3rd 2011 accusing it of lying about the quality of home loans it handled under a government program and is demanding that the bank repay hundreds of millions of dollars of losses on those loans. The suit is a civil suit that was filed in the Southern District of New York. The suit stems from the lending practices of MortgageIT a company that Deutsch acquired in 2007. Continue reading
Going into this week of trading the technical charts point to the 113.00 level as an important point to determine whether the September rally will continue or if we will again see the gains made over the past month given up again. If the SPY is able to break through the 113.00 level we will see the rally continue and fill the gap to 116, the level from the first shoulder of the pattern. Continue reading
Leading into the last day before options close for the month of September we again see a second day with an extremely low put-to-call ratio this time at 0.26 which was even lower then Wednesday’s level of .45. While the S & P 500 was not able to end the day at a positive level it is important to note that it did close at a higher level then it opened at. In the 33 times that the put-to-call ratio has fallen below .5 since the stat has been tracked in 2006 19 times the next trading day the S & P has closed the day higher then the price that it has opened at. This includes yesterday after the market opened down and managed to work its way back to an almost a neutral close. Continue reading
I am of the opinion that the jobless numbers are not going to matter too much for this week after the action that we saw in the S & P 500 yesterday. Given the action from The Bank of Japan and lower than expected manufacturing numbers yet the market continued to rally it may be indicative of the sentiment of investors at the moment who seem to have faith in investing long. While the put-to-call ratio from the VIX would suggest that the really will continue today there seems to be a general consensus that jobless claims are going to fall in around 460,000 up from 451,000 last week.
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Yes, the number of homes reposed by the bank rose again for the ninth straight month but this number does not cause a lot of concern for me in the overall economic outlook. With banks repossessing 95,364 properties last month this may seem like a very bad situation but I actually see it in a more positive light. Home Foreclosure is a very expensive process for the banks so the more homes that are done the process the more resources the banks can now focus on creating new mortgages to replace the old. While yes it is unfortunate to see that people are losing their homes with a swell in repositions happening now and a continued drop in initial defaults over the past seven months is encouraging news. This means that the banks are not being encumbered with more bad debt and are able to clear out much of the bad debt that they have had to continue to hold over the past year. Continue reading
As the VIX jumped today even with the S & P 500 moving upward, put-to-call spread over the past few days have been rather high being well over 1 which since the ratio has been tracked from February of 2006 this has traditionally been a rare event happening around 10% of the time. (146 times out of 1148 days traded) So while the past week has seen rather usual put-to-call spreads it is important to note what this mean on the day to day. Since the stat has been tracked the S & P 500 has opened up only 47.9% of the time. This should not come as a huge surprise given how the S & P 500 has fallen over the past 4 years. Continue reading
With the news of lackluster Manufacturing numbers released today coupled with the news that The Bank of Japan will be attempting to depreciate the Yen against the Dollar it appears that the recent activity in the VIX put-to-call ratio may be traders who where long calls of VIX hedging their positions. If this is true we will most likely see the S & P give back the gains of September. This will not come as a complete surprise as many people have been calling for a pullback. On the short-term with the VIX up and the S & P stalling buying puts may be the smart play for those who are willing to speculate.
Entering this morning S & P futures opened down as expected after The Bank of Japan intervened in the currency markets selling Yen against the Dollar. This in theory should cause the US markets to open down as the strength of that dollar appreciates against the Yen. Continue reading
As the S & P 500 moves back towards its August highs the CBOE Volatility index may be a crucial area to look at in determining whether the current September rally will continue to move upward or if this is just a blip on the radar before the bears take back over and the market continues to fall back again. The VIX, which is often known as the fear gauge, has been decreasing steadily so far in September and is close to its 1-month lows. Continue reading
