Weekly Update: May 12, 2016

| May 12, 2016

Weekly Update:  May 12, 2016


What To Watch

Last week was a bit weird in the sense that it felt like a lot was going on in the markets, but the actual results are mostly unimpressive. Choppy markets will do that – give the impression of a lot of movement but the actual percentage moves are pretty small.  Still, there seems to be more overall action across asset classes since our last update.

The S&P 500 is up small for the week, and not quite up 2% for the year.  The DJIA is also up for the year, while the Russell 2000 is just negative, and the Nasdaq 100 is down over 5%.  At the same time, 10-year Treasuries are up 4% for the year, meaning bonds have still been the better bet this year than stocks.

Crude oil is up 7% for the year after climbing nearly 6% this week.  Even natural gas had an up week for a change!  On the other hand, gold and silver gave back about 2%. Copper had the worst week in the commodities complex, down nearly 4%.

We’re finally seeing a spike in jobless claims over the past few weeks.  The financial media is getting worked up about it, but I think it’s just standard reversion to the mean.  I’m really not that worried about the economy right now.  Also, the Fed is still not going to be in any hurry to raise rates.

Let’s take a look at our positions.


Portfolio Recap

Position #1: Wells Fargo (WFC) May 48 Calls

Price Paid: $0.88

Time Until Expiration: 7 days

Not much left to say.  You should be out for profits.


Position #2: Ciena (CIEN) May 18 Calls

Price Paid: $0.62

Time Until Expiration: 7 days

CIEN is really frustrating.  There’s really nothing bad that’s coming out, it’s just general negative tech action hurting the stock.  Not much we can do but wait to see if there’s a final week boost.


Position #3: Apple (AAPL) May 95.50 Calls

Price Paid: $0.92

Time Until Expiration: 7 days

Apple has been all over the place for us, but the bears won out this week.  Concerns over iPhone sales pushed the stock below $90, and conservative traders should be out.  It was just a week ago or so that this was a 95% winner!  That’s the nature of the tech market right now.  For those still holding, we’ll need a major surge before expiration next week.


Position #4: LifeLock (LOCK) June 11 Puts

Price Paid: $0.30

Time Until Expiration: 35 days

We just made this trade yesterday so nothing to report yet.  We’ll talk more about it next update.


Category: OTW Weekly Updates