Todd Horwitz Chief Strategist BubbaTrading.com
Be Prepared not Surprised.
We have been witnessing one of the easiest markets to predict in history, the bulls are in total control. Every dip finds buyers the bears have been unable to cease control. The biggest reason for the continuation of the rally is TINA, there is no alternative.
Important to remember, although direction has been easy everything else has been almost impossible. The slow drift higher keeps trading a challenge. Although the VIX had one spike last week the trend is lower, traders depend on volatility which makes trading conditions tough.
It’s with little surprise we see the top options strategies bullish, Call Buyers control the top followed by, Bull Pit Spreads, Bull puts and Bull Call spreads. There are few bear strategies in sight leading to a massive amount of complacency.
A couple of things to remember, Complacent markets usually signal the end is near and there is no such thing as a cheap option. As pundits continue to push the idea to buy “cheap” protection remember, options are fairly priced except when expensive.
Tech continues to lead the way with QQQ, AAPL and AMD on the top. SPY and IWM have snuck into the top five with earnings season beginning Tuesday. The Bears are led by GLD, GE, AG, X and NUE. This is a huge week as earnings kick off, but all signs lead to a higher market.
As traders and investors, we have one thing to remember, follow the trend of the market. Be patient disciplined and leave your emotions out. The most important thing to remember is money management and self-control.
Todd “Bubba” Horwitz