Morning Commentary for Thursday, August 19, 2010

by Tom Nunamaker on August 19, 2010

E-mini S&P 500 1084.50 -2.25
EUR/USD 1.2877 +0.0014
30-Day Fed Funds 99.830 +0.005
Gold 1235.9 +4.5

Jobless Claims came in at 500K, above the concensus of 480K.   That’s the highest number since Nov 2009.  The markets dropped initially on the news but have recovered somewhat.  I don’t see any more economic data that will move the market today.  I expect it to be a slow day from here on.  A friend of mine who is really good at technical analysis expects the 1070 support level to be tested, then move higher again.

The Euro/USD stalled at 1.292 then lost some ground to 1.2773 but has recovered to 1.2883.   Big moves in the currencies if you ask me.  Lots of volatility as traders move around from equities, bonds and currencies based on the risk appetite du jour.  Bonds are within one point of the recent high.

Still lots of volatility in the markets.  Economic news seems to be a matter of what’s less bad.  Hard to predict which way the markets will go.  Given that, use protective long calls and puts to hedge yourself from big P/L changes with intraday swings.

Twitter Update

I’ve been updating our Twitter page (http://twitter.com/sheridanoptions).  I’ll be tweeting about option and market topics there, in addition to our regular blog posts and mentoring program announcements.

US Air Force F-35

US Air Force F-35

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