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Ring around the Rosie, Pocket Full of SPY Put Options

I recently remarked that the uptrend had resumed in the S&P 500 e-mini stock futures (albeit a weak uptrend) after emerging from a minor low on December 16th at 1961.50. The e-mini then rose to 2088.75 on December 26th before falling to 2046.25 at the close on January 2, 2015.  I address in this essay whether a put option hedge may help investors potentially protect their portfolios from a decline in stock prices at this juncture in the stock market.
 

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S&P 500 Resumes Uptrend in V-Bottom Recovery

As I stated in my December 10, 2014 post here, when the S&P 500 mini futures closed at a price of 1992.5, that buying SPY puts was indicated in order to hedge a potential decline in U.S. equities prices. I based the potential success of hedging at that juncture on an “end of uptrend” or “sell” signal from the early onset trend indicator in the S&P 500 e-mini futures on that date.
 

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Time to Buy Puts on the S&P 500 (SPY) for a Greater Decline Ahead?

The S&P 500 index declined further today from its recent high of 2079.47 and closed at 2026.14 as sellers took precedence and the "buy on the dip" crowd did not step in to reverse the selling tide.
 
With oil prices in free-fall (a sign of deflation, decelerating demand and Saudi oil price manipulation), European economies stagnating, and a strong dollar placing downward pressure on some emerging economies - players might do well to wonder whether today's decline may be the start of a more serious correction in the American stock market.
 

Continue reading » Time to Buy Puts on the S&P 500 (SPY) for a Greater Decline Ahead?

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Halloween S&P 500 Index Monthly Bar Averts Top in a Chilling October!

In my chilling October 12, 2014 post on this site, "Is a Long Term Top in Place in the Stock Market," I related that the market had plunged on October 10 through its 200 day and 40 week moving averages on a daily and weekly basis respectively, Closing for the week below the 40 week moving average was a potential intermediate sell signal for the market. The S&P 500 plunged as low as 1820.66 on October 15th intraday.
 

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Why U.S. Bond Yields May Continue Lower: Wall Street May Have It Wrong about Interest Rates

Shortly I hope to post charts on this website; but in the meantime please allow me to convey my view that interest rates may be headed lower and may stay low longer than most think – contrary to the opinion of many on Wall Street.
 

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Is a Long Term Top in Place in the Stock Market?

The S&P 500 Index closed for the week ending Friday, October 10, 2014 at 1906.13. Three moving averages are in play that may provide important signals determining the potential future direction of the market at this important juncture.
 

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Can the Gold and Oil Markets Price Performance Telegraph Future U.S. Economic Conditions?

May one attempt to forecast the long term future dynamic of the economy by examining the nascent or long term price breakouts (sometimes measured in multi-decade patterns) of economically important sectors of equities or commodities such as the gold and oil markets and to project forward further significant long term price progress in the group?
 

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Creative Destruction, the Bailout and its Ultimate Costs

What can we learn from Joseph Schumpeter's idea of "creative destruction" in capitalist economies as it applies to the U.S. current economic situation? How has the Obama administration and the Federal Reserve attempted to stop the economic process of creative destruction from taking place in our economy today? How has the Great Bailout harmed our country's economic future and the worth of our currency?

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Inflation Hedge Strategies and Thoughts for 2010 and Beyond

It is widely known that government authorities across the globe are attempting to pump prime their nations' depression-racked economies by printing vast sums of paper money. Some nations, including the United States, are running trillion dollar deficits and will go deeper into debt in future years in order to finance an expansion that may not materialize as planned.

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The End of the Dollar as We Know It?

The currency markets, like most other financial markets, rise and fall partly based on international confidence in the economies, politics and monetary and taxation policies of the various nations whose paper money is traded through international exchanges.

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