Daily Market Analysis – January 15, 2016

The Friday session sees several different announcements coming out of the United States, including be Retail Sales number, the Empire State Manufacturing Index, PPI, and several other minor level announcements. That being the case, the market looks as if the US dollar and the US stock markets will probably be the main markets that are paid attention to.

1 – In general, we like shorting energy via puts, and we like shorting stock markets the same way after rallies. At this point in time, most of these markets are a bit oversold, so bit of a relief rally could be coming. The economic situation around the world right now is a bit skittish at best, so having said that we believe that it will decidedly point towards a “risk off” type of situation for the near term.

2 – Given enough time, we believe that risk appetite will return to the market, but having said that it is almost impossible to imagine that happening anytime in the next couple of days. After all, there has been a significant amount of destruction in the markets, so having said that we think that it will take a while for the bullish traders out there to turn several these markets around. We continue to buy puts every time one of the risk assets out there rallies, looking for short-term trades only at this point in time.