I’d like to take a look at this week’s move in the broader market ($SPX) and see what happens tomorrow with options expiration. To do this, I’ll take the high of the week and the low of the week and then plot the Fibonacci levels. If the market can climb above and close beyond the 50% retracement ($815.80), then there is a bit of hope left for the bulls. Keep an eye on the Fib levels with your own trading as the day progresses and see what happens. Remember, we’ve seen nearly a 13% drop in the S&P just over the past two days! A bounce tomorrow wouldn’t be a surprise. What would be a surprise is if we continue to move lower here, especially with all the premium in those at-the-money puts.
- Post author:Darren Miller, Ph.D.
- Post published:Thursday, November 20, 2008
- Post category:Commentary