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DrosNotes - 06.14.2018 - Market Recap and Four Witches


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Summary of some of what went on in the stock market today and a look and what to expect tomorrow, June 15th, 2018, this year's second quadruple witching Friday for the market.

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DrosNotes - 06.14.2018 - Market Recap and Four Witches

  1. 1. DrosNotes June 14, 2018 The original quote above that is from Shakespeare’s Macbeth. It says three, as three withes meet in a forest dark at night to plan their next meeting. I’m not sure when those three will meet next, but I do know that tomorrow is what we call “quadruple witching”. So we know when those will meet again. Quadruple Witching For those of you familiar with the term, as well my readiness for sleep approaching quickly, I’ll keep my explanation brief. The four witches we’re talking about appear quarterly: - Monthly Stock [single..e.g. $TSLA] Options Expiry - Monthly Stock Index Options Expiry - Monthly Single Stock Future Expiry - Monthly Stock Index Futures Options Expiry 1 Today In History: The Continental Congress Adopted Stars & Stripes in 1777 (original above courtesy DrosNotes - June 14th, 2018 “When shall we three four meet again?”
  2. 2. DrosNotes June 14, 2018 They show up in March, June, September and December each year…on the third Friday of each of those months (the standard monthly options expiries. So we’re going to see one tomorrow. What that means is typically a lot of volatility and volume. Way more than we typically see day-to-day. Market makers and traders will be scrambling all over the derivative markets and the equity markets to make sure those lose as little money as possible. In a market that took an (immaterial in my opinion) dip on the Fed’s announcement on Wednesday, then was fragile and very low volume on its rise today…tomorrow’s action is going to be nasty. Some stock will spike. Some will fall hard. Hence volatility. • A $VIX long sorts would be prudent. • Watch the Chinese stocks for a potential hard pullback based on the O.I. in a lot of those names. That’s why $YANG in on my watchlist for tomorrow. • Futures are fairly flat as I’m typing this [11:52 PM EST] - The dollar on the chart so far tonight seems to have peaked. I would imagine that means the maybe overnight that helps push the US indices towards a bullish mode at open tomorrow. We’ll see. 2
  3. 3. DrosNotes June 14, 2018 - Be careful of certain high-betas taking some vicious moves tomorrow based on how the options have been trading ($MU $ATVI come to mind). Moves could be viciously up though. - Blocks of miners keep getting loaded up each day, keep your eye on $GDXJ Here’s my watchlist for tomorrow: No particular order. Actually I see it’s sorted by price there…that’s not the point. Just the stuff I expect to make some moves tomorrow. 
 As always, these are just my thoughts. I could be totally wrong about all of this. 3
  4. 4. DrosNotes June 14, 2018 If you’re reading this on the blog, just scroll down to get the direct link to that watchlist for your ThinkOrSwim Platform. Otherwise check out the site! :-) Safe trading, - Dros Oh and some notable UOA [names included in the watchlist but…] - $NVDAAUG18 $305 Cs - $FCXAUG18 $20 Cs - $DIS SEP18 $120 Cs - $WMB JAN20 $32 Cs - $EA SEP18 $190 Cs - $HOLX JUL18 $40 Cs - - 4