On Sunday, for No Particular Reason ™, the equity futures vaulted higher. The /ES was up over 30 points, but over the course of the night this has faded into virtually nothing. I continue to believe we’ll have another swoop lower at some point in the coming days, although this week and next week will probably be rather subdued, with a major holiday plopped right into the middle of each one.
I mean, it’s no Juneteenth, but let’s all admit Christmas is kind of a big deal.
During Friday’s hilarious rally, I bought short-dated (Dec. 31) SPY puts where the arrow is pointing. Not the best price of the day, but not at all bad. I sold 30% of those for a profit moments before Friday’s close, but I’m hanging on to the rest – – as well as 14 other much longer-dated puts – – for much better prices.
Longer-term, I think the arrow marks our “You Are Here” equivalency.
The utterly misguided optimism of a new year and, even more misguided, a new administration, will bolster hopes that P/E ratios in the quadruple-digits actually make all the sense in the world. We’ll get another big swoosh higher based upon the last gasp of optimism, which I intend to exploit with hopefully un-terrible timing.
In the meanwhile, during this very quiet two-week period, let’s squeeze out what we can. There’s precious little to move these markets, since the meat of earnings season is a month away and there’s zero economic data of importance until will until 2025, so it could be fairly blasé.
