Wow, what a rally in Japan, up 579 points to 15,111, which is up +3,98%. Gold and Silver is also up, but they are moving like turtles. Up 0,57% and 0,72%. Crude oil (brent) is down -0,28%, trading at 85,92. It will continue to be big opportunities for day traders now, as the market will still move up and down.
(Picture: Fear Index)
The appetite for volatility is bad for the Fed, and it didn`t take long for them to respond to last week`s market turbulence. A representative for the Fed said last week that the Fed could slow its retreat from a highly accommodating monetary policy, and this is something investors like to hear.
There were some rumors last week that the Fed could embark on QE4 to support asset prices. Not only investors are nervous at times like this. Also Fed are. So, what can we expect the coming days and weeks in the market?
We need to look at charts and data. The S&P 500`s 200 MA price is 1,906, and the stock market was trading below that technical level. That level was a floor during the selloff since November 2012, and the average price of the S&P 500 is a good indicator to be bullish on.
This is not the first time that have happened, and we have seen this many times. The mentality now is «buy the dip», as there is pretty good U.S fundamentals out there, which is making investors interested in buying again.
The fear index plunged -12,74% on friday, and the gap in the curve in the Vix futures, gave investors optimism. If we compare the cost of the options that protect against losses in shares in November versus those timed to expire in 90 days, you can predict the future. On friday, selling dropped down 3% on October 15, while near term options skyrocket 25% above those timed to January, and this is the most in three years.
We are close to the end of the sell-off in the equity market, as the bottom has been seen and this is historically a time for bottom fishing. It has happened six times when Vix has surged above its own futures like we saw the last week. The inverted curves is historically a sign that investors think the spike is coming to an end.
I`m exited about Apple Inc later today after the closing bell. Are they able to beat the Wall Street? It`s estimated that Apple Inc will report revenue of $39,8 billion ($37,5 last year) and earnings of $1,31 per share ($1,18 last year).
iPhone sales is what people will look for, and it`s estimated to see that Apple may have sold about 38 million iPhones. A strong dollar can help them a lot to beat the revenue estimate, but what about Apple Pay? Is it gonna be launched today?
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