Friday, October 9, 2009

09/10: Markets close near YTD highs

U.S. markets positively closed out an impressive week that has brought indexes to just below their intraday highs for 2009. The S&P500 closed at 1071, with an intraday high and low, respectively, of 1072 and 1063. As indicated by these numbers, there was little volatility during today's session, as might be expected with the markets edging up to major resistance. For reference, the Dow closed today at 9865, with I-D H/L values of 9865 (as with the close) and 9765, respectively. A 10-day'er of the more comprehensive benchmark follows:

My own trading today has been extraordinarily unremarkable. I did, in fact, not give a cent of commission to my broker today, and I am holding into the weekend the same GS calls ($190, Nov) that I owned at market open.

Goldman Sachs has consolidated today within a tight range. This action appears cautiously bullish, particularly as the stock price has clearly broken out of yesterday's downtrend. GS is no longer completely over-extended from its advance from $176 (which began a week ago, on Friday, October 2) and instead has a floor from which to attack the $198-205 range. Critically, the upper end of this range represents significant resistance off the 2-year chart. Perhaps next week might see a capitulation rally to the upper end of that range? In any event, Goldman Sachs will release its third quarter earnings report on Thursday, October 15, which may spur buying in the lead-up (and appreciation of options due to an uptick in implied volatility). A 10-D of GS:

This will wrap up tonight's post. On a personal note, I'm rather exhausted after a trying week, although I am heartened to be ending it on an upswing. I'm also still under the melancholy, introspective influence of a terrific film that I saw this evening: "The Boys are Back."

Best of luck this weekend! I have a stack of books on derivatives & technical analysis and am hoping to make progress on at least one or two; this is in addition to obligatory savouring of the Weekend FT and weekend NYT editions.

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