Option strategy to benefit from laid-back XLE versus chirpy WTI

Since spot West Texas Intermediate crude broke out of 54 mid-April, it has continued to add to gains, even as XLE, the energy SPDR ETF, has gone sideways/down. Since that major push through four-month consolidation in the middle of April, … Continued

Bear call spread, to benefit from potential pressure on XLE near-term

posted in: Derivatives, Equities, Technicals | 0

XLE ($82.22), the energy ETF, seems to want to go lower near-term. Since the mid-January low of $71.22, it has carved out a pattern of higher lows, and higher highs, hence now finds itself in a slightly upward sloping channel.  … Continued

Buyback-induced breakouts — signal or noise?

posted in: Economy, Equities, Technicals | 0

GE stages massive breakout Friday on back of massive buyback announcement S&P 500 companies splurged $565 billion on share repurchases in 2014 As/when buybacks dry up, support zones become more vulnerable Before last week, GE shares had been on a … Continued

Dow induction alone does not ensure peak in share price

posted in: Equities | 0

AAPL set to join Dow brings out ‘this is top’ talk Historically, tough to argue Dow inclusion ensures top If AAPL peaks, it will be for other business-related reasons AAPL (127.14) is slated to replace T in the Dow Jones … Continued

Squeezed and hurt, shorts likely to begin to rebuild position in XLU, XLE, IWM

posted in: Equities, Technicals | 0

Short interest inched up on NYSE and Nasdaq, and hovers near multi-year highs Shorts squeezed out of several sector ETFs since mid-Oct bottom in stocks Shorts probably will get active and rebuild position in XLU, XLE, IWM Short interest inched … Continued

Odds of continuation — or a lack thereof — of divergence between large- and small-caps

There was an article on MarketWatch.com on Friday entitled “Why lagging small caps might not bring down the S&P 500.”  The title says it all.  The story seeks to justify why prevailing weakness in U.S. small-caps is not a cause … Continued