Analysis for Short Term Option Trading!
Technically Speaking-
Trade Recommendations- we look very bullish from a long term technical stand point. So we would have to say we are still bullish long term!
Bollinger Bands- the SPY is not quite touching the top of the bands and this is healthy for bullish minded traders. This means it still has the ability to move up before it pushes outside the band. Looking bullish!
RSI- the SPY nicely bounced off the top ‘70’ band. We are healthy around 67 and can still move up without much of a problem. We could get an extended move up through the over bought if the stock continues to show bullish moves.
MACD- the MACD is still in bullish territory with a slight lean but very bullish. Not noticing much of a movement in the MACD Histogram. This could mean very little movement in the stock and give us a series of doji’s in the candlestick patterns.
Outside Market Influences-
World News
Two European Union officials say euro states are debating speeding up capital payments into their future rescue fund so it can reach its full €500 billion ($670 billion) capacity by 2014. The European Stability Mechanism has €80 billion in paid-in capital, which it can leverage similarly to a bank to lend out a maximum of €500 billion.
At the moment, the countries' payments into the fund will be spread out in five installments, the first two of which will come this year. That means that when the ESM comes into force in July, it would only be capable of lending some €200 billion in bailout loans.
The risk of a Spanish debt restructuring is higher now than it has been since the beginning of the crisis, Citigroup chief economist William Buiter has said. "Spain looks likely to enter some form of a troika program this year, as a condition for further [ECB] support for the Spanish sovereign and/or Spanish banks."
US Markets
Oil prices fell to near $106 a barrel Wednesday after a report showed a larger-than-expected jump in U.S. crude supplies, suggesting demand remains weak. By early afternoon in Europe, benchmark oil for May delivery was down 91 cents to $106.42 in electronic trading on the New York Mercantile Exchange. The contract was up 30 cents to settle at $107.33 per barrel in New York on Tuesday.
The number of Americans who signed contracts to buy U.S. homes dipped in February from nearly a two-year high, a mixed signal ahead of the spring home-buying season.
Federal Reserve Chairman Ben Bernanke said on Tuesday it is too soon to declare victory in the U.S. economic recovery, warning against complacency in policymaking as the outlook brightens.
"We haven't quite yet got to the point where we can be completely confident that we're on a track to full recovery," Bernanke told ABC News in a rare on-the-record interview.
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