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Equities Finish Higher Ahead of Option Expiration

Discussion in 'Forex Daily News & Outlook' started by futuretrends24, Aug 20, 2009.

  1. futuretrends24

    futuretrends24 New Member

    Apr 30, 2009
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    Today’s sample of Futures Analysis from FuturesHound.com

    U.S. equity markets finished higher on Thursday in a follow-through rally following yesterday’s bullish crude oil report. It was difficult to tell today what the driving force was behind the rally since crude oil finished lower and the currency markets were lifeless.

    The best explanation for the strength is tomorrow’s option expiration. For several weeks, traders have been talking about the need for a correction. The VIX was rising along with the open interest in puts. Today’s rally may have been an attempt by option writers to keep the lower strike puts out of the money.

    The strong close in the September E-mini S&P 500 kept this contract within striking distance of the August top at 1016.00. Without bullish news to drive it higher, breaking this price could be difficult. Since it is option expiration day, watch for trading on both sides of 1000.

    Read full article at FuturesHound.com as well as Futures Analysis, Futures Education and exclusive timely market Gann Analysis

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