Friday, December 19, 2014

Quad Witching Today

To My Knowledge These Fine Ladies Have Nothing To Do With Quad Witching!

DEFINITION of 'Quadruple Witching'

The expiration date of various stock index futures, stock index options, stock options and single stock futures. All stock options contracts expire on the third Friday of each month and once every quarter - on the third Friday of March, June, September and December - all four asset classes expire on the same day. Because futures and options investors must close out of their positions on those days, they often witness increased trading volume. 

'Quadruple Witching'

The term "witching" comes from the fact that in the past, the expiration of futures and options contracts occurred not only on the same day, but at the same time. This often resulted in a period of greater-than-normal market volatility, which became known as the "witching hour." Due to this increased volatility and frenzied market activity, many investors approach the markets differently on witching days. 

Good morning folks, 

We had quite an amazing bounce over the last couple of days. After the weakness we experienced the first part of December its not a huge surprise that we got a bounce. The Santa Clause rally appears to be a self fulfilling prophecy once again. Gap up days are typically challenging trading days however in the morning there were some decent day trade opportunities out there. It was an interesting lower volume day where Oil actually sank into its close, the markets put in a huge day while Gold and the strength of the dollar also climbed. It was an interesting day and I think there were some shorts that may have been taking by surprise. One thing of note was that the momo names that have led the market rise has a bounce yesterday but their performance was not nearly as dramatic as the markets performance. I am still cautious and will be using this rally to lighten up the load on some swings and build a nice cash position to have in place as we move into the New Year. There could be quite a bit of volatility today so be careful out there.  


Stocks on my Radar

JUNO IPO highly anticipated, OGXI decent daily pr thin float active premarket, PETX pr last night big gapper, CERS possible continuation off pr, AGEN looking for the 4 dolla roll, MOLG announces share repurchase program gapping I would not chase it, OREX positive pr gapping taking out 7, RUSL possible bounce, TRXC possible continuation off pr, FEYE HACK CYBR like the whole sector, BBRY may pick this one up for a swing on weakness

JNUG JDST TVIX TZA IWM USO SPY NDAQ UUP for market sentiment 

CNBC in the news

IN THE NEWS TODAY
U.S. stock futures were sharply higher in early trading, after Thursday's421-point Dow surge, which pushed the average's two-day rally to 4.2 percent—the biggest since November 2011. (CNBC)

Oil prices moved higher early this morning, after ending Thursday down 4 percent. The powerful Saudi oil minister said OPEC can't cut output without the support of other big producers. (CNBC)

Besides the $9 billion in oil sector spending cuts already announced, an energy consultancy forecasts reductions of another $170 billion next year if Brent crude remains around $60 a barrel. (Oil & Gas Financial Journal)

Thomas Friedman, foreign affairs columnist at the New York Times, joins CNBC's "Squawk Box" for an hour at 8 a.m. ET to talk oil, Russia, Cuba, and North Korea hacking.

Dow stock Nike (NKE) beat estimates with earnings and revenue. The sports shoe and apparel maker also said global futures orders were 11 percent higher, excluding currency changes. (Reuters)

Struggling smartphone maker BlackBerry (BBRY) reported quarterly revenue today that fell short of expectations, but managed to post a small adjusted profit and positive cash flow.

BlackBerry CEO John Chen joins CNBC's "Squawk Alley" at 11 a.m. ET to break down the numbers and talk about the recent rollout of its Classic smartphone.

Google (GOOG) is laying the groundwork for a version of Android built directly into cars, allowing drivers to use the Internet without plugging in their smartphones. (Reuters)

Thai Union Frozen Products, the world's biggest producer of canned tuna, has agreed to buy U.S. rival Bumble Bee Seafoods for $1.5 billion. (Reuters)

Shares of Warren Buffett-backed electric car maker BYD rebounded as much as 19 percent today from Thursday’s plunge, after management sought to reassure investors. (CNBC)

Working conditions at the companies that supply parts for the Apple (AAPL) iPhone 6 were in the spotlight, after an undercover investigation by BBC News, which found poor treatment of employees in China.

EBay (EBAY) CEO John Donahoe will get an exit package worth an estimated $23 millionafter the company splits from payments unit PayPal next year. Donahoe plans to step down in September. (Reuters)

Billionaire investor Carl Icahn has pledged $20 million to keep Atlantic City's Taj Mahal casino open indefinitely—eliminating a plan to shut it downSaturday. (AP)

The White House is set to spell out an ambitious college-rating plan today. Meanwhile, President Barack Obama plans to hold his year-end news conference this afternoon, before leaving for vacation. (WSJ)

The hacking attack on Sony Pictures may have been a practice run for North Korea's elite cyber-army in a long-term goal of being able to cripple telecoms and energy grids in rival nations, defectors from the isolated state said. (Reuters)


BY THE NUMBERS
Today's quarterly expiration of futures and options could bring volatility. Art Cashin at UBS said the bias in the "quadruple witching" expiration, and anS&P index rebalance appears to be to the upside for Friday.

Investors will be watching speeches from Chicago Fed President Charles Evans and Richmond Fed President Jeffrey Lacker, both of whom will be voting members on next year’s central bank policy committee. Meanwhile, It’s a rather light day for economic news, with only the December survey ofregional activity from the Kansas City Fed.

Alibaba (BABA) investors will get their chance to sell shares today, after theexpiration of the first lock-up period Thursday. The Chinese e-commerce giant’s offering this year was the biggest on record, which helped fuel a 50 percent increase in IPO activity in 2014.
STOCKS TO WATCH
The Treasury Department plans to sell its remaining 54.9 million shares of Ally Financial (ALLY) acquired under the government's bailout of the auto lender. The stake is worth about $1.25 billion based on Thursday’s close.

Metlife (MET) has been dubbed a systemically important financial institutionby the Financial Stability Oversight Council. Metlife said it was disappointed by the designation, which brings with it heightened supervision by the Fed.

Xerox (XRX) has agreed to sell its IT outsourcing business to Atos of France for $1.05 billion. The deal is expected to close in the first half of 2015.

Clothing manufacturer American Apparel (APP) has been approached by private equity firm Irving Place Capital for a possible takeover, according to the Wall Street Journal. American Apparel this week fired founder Dov Charney.

Seeking Alpha 
Today's Markets:
In Asia, Japan +2.4% to 17621. Hong Kong +1.3% to 23117. China +1.7% to 3110. India +0.9% to 27372.
In Europe, at midday, London +0.5%. Paris -0.2%. Frankfurt -0.3%.
Futures at 6:20: Dow +0.3%. S&P +0.3%. Nasdaq +0.4%. Crude +1.3% to $54.83. Gold +0.2% to $1197.50.
Ten-year Treasury Yield flat at 2.21%
Notable earnings before today's open: BBRYKMXCCLFINLPAYX
Best of Success!