• Daily Game Plan – Eyes on The Fed

    by  • July 10, 2013 1:41 pm • Broad Market Analysis, Bryan Sapp’s Daily Game Plan, Charts to Watch • 0 Comments

    MARKET CHECK

    Markets are very quiet today ahead of the 2:00 FOMC Minutes, and Ben Bernanke’s speech in Boston after the bell.  Stocks opened near yesterday’s close, and have since traded in a very tight intraday range.  There is very little news hitting the tape today, other than very weak overnight data out of China.  However, despite the weakness, stocks are holding their bids for the time being.  Currently, the Nasdaq is today’s relative leader, up by about 0.2% on the session, while the Dow, S&P 500, and Russell 2000 are all slightly lower.  Metals are also trading near breakeven, while bonds are getting hit ahead of the Fed Minutes.

     

    CHART OF THE DAY

    Chicago Bridge and Iron Company (CBI) – The infrastructure concern has been strong this year, up by about 30% since January.  The shares have rallied sharply since pulling back near 50 in May, and currently sit perched above their 50-day moving average.  This trendline should act as support going forward, and offers a nice entry here from the long side.

    I like a bullish play here with a stop placed on a close below 59.  I would initially target a move back near 64, with 70 as a stretch target.

    courtesy of stockcharts.com

     

    WHAT I’M EXPECTING

    I’m not expecting much from today’s FOMC minutes(while many others are), but Bernanke’s speech tonight could spark some fireworks in the market for the short term.  A long/short equity strategy remains optimal until the S&P 500 can break above 1660 or below 1600.

    About

    Bryan Sapp is a Senior Trading Analyst at Schaeffer’s Investment Research, where he has specialized in volatility-based options trading since early 2010. With Bryan at the helm, Schaeffer’s Volatility Trader generated a 2012 portfolio return of 70% for subscribers. This real-time option recommendation service exclusively trades short-term straddles. Prior to joining the research team at Schaeffer’s, Bryan honed his skills as a speculator by trading his own account, and playing poker professionally to pay his way through college. Bryan attended the University of Louisville, where he received his Bachelors in Economics and an MBA with an Entrepreneurship focus.

    http://www.schaeffersresearch.com/

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