OpEX Session Ends With Short Week Ahead
Another significant move happened overnight in the stock market which has been a common theme this week.
With Options Expiration (OpEX) week, price has made powerful moves overnight and doing little to nothing during the following cash session. This price action is a tactic that Wall Street uses to make OpEX one of the most challenging weeks to trade each month. OpEx happens the third Friday of every month.
When the opening bell sounded today, the indexes quickly fell, erasing gains from throughout the night. This downturn left little to no time for anyone with call swing trades to lock in profits. It is also important to note that the market started to drop lower before the opening bell sounded as it approached resistance at the psychological level of 4,000 on the S&P 500 futures.
After the flush in the opening hour, the rest of the day was more of the same price action seen all week. The selling came to a stop around 3,950. (These levels were covered in our previous article as levels to keep on your chart.)
Holiday sets up short week in stock market
Next week is slated to be short as Thanksgiving Day is just around the corner.
The first thing to acknowledge when looking at the calendar for next week is the economic data that is set to report. Because of the holiday, Wednesday is going to be jam-packed with data.
Initial and continuous jobless claims are set for release at 8:30 a.m. Eastern, followed at 9:45 a.m. Eastern with the S&P Purchasing Managers Index (PMI) for manufacturing and services. The University of Michigan (UMich) Consumer Sentiment Index will release its data at 10:00 a.m. Eastern.If all of this was not enough, the Federal Open Market Committee (FOMC) minutes hit the market at 2 p.m. Eastern.
After possibly a volatile day due to the extreme amount of information for the market to digest on Wednesday, traders might want to enjoy a day on Thursday with the stock market closed for Thanksgiving.
The markets will be open on Friday for a half day. Markets will open up at the regular time of 9:30 a.m. Eastern, but will close two hours earlier, at 1 p.m. Eastern.
Friday is a day that many people will be taking off for all those shopping deals, and the stock market will likely have lower volume than usual. When there is low volume, it can cause the market to be more volatile and choppy than directional. Depending on your style, taking the day off and making it a two-day break may be beneficial.
Market fights to end week green… just barely
The Nasdaq and the S&P 500 were barely positive to close the session. The S&P 500 futures closed up 0.41%, gaining 16 points, while the Nasdaq futures closed up 0.25%, a gain of 2 points. The Dow Jones futures followed, closing up 0.54%, adding 181 points.