Friday, December 19, 2008

Bailout on Quadruple Witching = Rally.

The markets have rallied about 10 times on the rumor of an auto bailout. The automakers finally got their 2 mth lifeline (how much better will business be in March?) and the timing couldn't be better.

There are massive amounts of options expiring today and those options drive the market today (it's fairly complex, but expect lots of weird swings as people push the market up to devalue puts - to buy them back - and then sell the market down to devalue calls - to buy them back).

Another crazy variable that market watchers need to keep an eye on is the weather. Many traders might try to beat the weather out of NY and Boston today. That could create some interesting action at the end of the day.


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