Treasury Note Hits 3% - Markets Sell Off and CAT CFO Places Foot in Mouth!

The yield on the 10-year U.S. Treasury note hit 3% for the first time since 2014. That and the idiotic remarks by Caterpillar's CFO sent the markets down. Who in their right mind, a person who's main responsibility is to increase shareholder value, would state to the world - Our first quarter will probably be the best for the year and the following quarter not so hot. In essence, that is exactly what Bradley Halverson told analysts today. The construction equipment maker's shares (CAT) plummeted 6%, the worst decline since June of 2016. What could someone in that position have said other then what he did? Lots of things. So you be the judge. Would you want your CFO to say that the comp

You Never Know What's Around the Corner

We had issued an alert for AT&T and as soon as we did the trade war talks started. It drove AT&T down - why? Not sure because it should have little to no impact on it from trade wars. We continued to hold AT&T in anticipation of a turnaround. Wells Fargo has it at an outperform with a $40 target. Jim Cramer had a recent article calling it a buy. But no matter what it would not pull up. So early today, after the Dow was up over 400 points, it was still not making any movement up. So we reluctantly decide to exit before it was a 100% loss. Then it suddenly spiked. We entered it at .38 cents, we exited at .06 cents and then it spiked as high as .33 cents today. We did hear from one lu

Market Records Being Set on a Regular Basis

Almost each day we are seeing big swings and historical records. There are many historians that have watched the markets for decades and have databases full of history. But the stock market is a very different animal and it changes continually. So it is really stretching it to say, based upon the data/conditions we see today this same pattern happened in the past and now we should start to see this now happen. In some cases, this hypothesis may take place and history repeats itself. But as we like to say – we’re not in Kansas anymore! There are many factors that make us, that while comparing present day conditions to historically similar conditions could be helpful, planning for the sam

Tit for Tat Trade War Puffery Rattles Markets; Dow -560

The tit for tat warning shots that Trump and China continue to trade daily with each other are wreaking havoc in the markets. At the time we have written this the Dow is down -567. It is also having an adverse effect on the AT&T alert we continue to hold. AT&T has been showing signs of recovery but as soon as those signs appear there's a new news story about trade and planned tariffs. We continue to hold AT&T with an optimistic view and 2 weeks to expiration.

700+ Point Dow Swing

The Dow opened at a loss of over 500 points and now with about 12 minutes left in the trading day it is up 227 points - incredible swing! Buyers came in and some market commentators suggested that the trade war, in the long run, could add value to the markets. Others also surmised that nothing is written in stone as of yet and that the tariffs may never take hold and if they do not as advertised. On this news the markets started a turnaround and steadily marched higher. Our alert on AT&T (T) we continue to hold with 16 days remaining to expiration and it is showing some signs of improvement. Where will the markets head tomorrow? Nobody knows so we hold on for more volatility.

Trade Wars!

Looks like the next market driver injecting volatility is going to be the apparent "trade wars" or fear thereof. This morning the futures are negative and this appears to be directly linked to China imposing tariffs on a list of 128 U.S. imports (to China) including agricultural products ranging from fruit to frozen pork. We have an alert out on AT&T that did rebound some last week only to retreat. We continue to hold AT&T (T) on the basis that is is a) oversold; b) rated outperform with a price target of $48 at Well Fargo; and c) it usually runs up into earnings which will be on April 25th. Our alert expires on April 20th, we have 18 days to see improvement before the option expiration.

​© 2020 - Optik Options