Trade Ideas | 1/24/19

January 24, 2019

So it's been awhile since I've posted some ideas. I've been patiently waiting for the market to calm down and recover a bit, the signal of that being repeated days of the S&P500 holding 2600 and $VIX below 20. We finally have that, so here are some ideas...

 

$IBM - This isn't a good idea YET, but, if $IBM can break that gap resistance from the previous earnings announcement, I think the stock can quickly retest the former highs at about 145. See chart below for details.

 

$TLT - with inflation expectations remaining stagnant and with recent blurbs from Fed officials, I don't think there will be any substantial movement in the bond market until March, if then. I don't think the Fed will continue to raise rates in the face of faltering global growth and meekening inflation expectations. But I don't have a crystal ball!

 

$EWZ - The election of Bolsonaro has obviously been seen as a good thing for Brazil's faltering economy. Whether or not expectations meet reality has yet to be determined, and I think, given the run this ETF has had, Brazilian markets will trade sideways while the new Bolsonaro administration starts to unfold economic policy.

 

$EEM - Global growth is slowing, yes, but emerging markets have remained stable. I think they continue to do so. 

 

With the exception of $IBM, all of these ideas are straight-up ATM Iron Butterflies for the March expiration. Nothing fancy here. Hopefully we don't have another early February surprise...!

 

 

 

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