"Monday's sharp upside reversal for the Dow Jones Industrial Average (INDEXDJX:.DJI) came ahead of Wednesday's Federal Open Market Committee (FOMC) policy statement -- an event that typically has a positive bias in the days leading up to the meeting," noted Schaeffer's Senior Options Strategist Tony Venosa, CMT. The FOMC kicks off the two-day affair today, and in pre-market trading, futures on the 30-stock index are nearly 57 points higher.
Looking ahead, Venosa says to "Keep an eye on the housing sector, which has experienced a strong pullback during the past two weeks. There is plenty of housing data and earnings from some major homebuilders due out this week, which could put the focus back on this group during expiration week." Additionally, investors will be taking note of events unfolding overseas, after Russian President Vladimir Putin yesterday defied Western sanctions and formally recognized Crimea as an independent state. Putin is scheduled to address the State Duma this morning.
Futures on the Dow Jones Industrial Average (INDEXDJX:.DJI) are roughly 57 points above breakeven.
The Chicago Board Options Exchange (CBOE) saw 987,063 call contracts traded on Monday, compared to 560,258 put contracts -- the fewest thus far in 2014. The resultant single-session put/call ratio fell to 0.57, while the 21-day moving average remained at 0.59.
Currencies and Commodities
Earnings and Economic Data
The consumer price index (CPI) and core CPI, as well as housing starts and building permits, will hit the Street today. Meanwhile, the FOMC will kick off its two-day policy-setting meeting. Adobe Systems (ADBE), DSW (DSW), Oracle (ORCL), Pacific Sunwear (PSUN), Renren (RENN), and Yingli Green Energy (YGE) will step up to the earnings plate.
The Case for Big Moves in IWM and QQQ
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