Stock Market Recap for Week Ending April 17, 2009 Plus Next Week's Earnings Preview

For the options expiration week of April 13, 2009 the week ended stronger for the sixth week in a row. The S&P 500 finished the week up $13.15 or 1.54%, the Nasdaq finished the week up 23.52 or 1.43%, and the Dow Jones Industrial Average finished the week up 45.42 or .56%. This market seems to be very tired. Earnings even on the on the positive (surprise) side don't seem to be having a great effect, as the did a week or so ago. To hedge myself and the substantial amount of money Ive made over the past 6 weeks, I purchased some BGZ around 45 a share today. I think with next weeks very busy earnings schedule and a few misses (negative surprises), we may have a short bear raid. I could be wrong but I think any negative news could make this market react quite bearish. On the other hand these names could surprise as well (down year/year but not being as bad as most analysts predicted), and there is still a huge amount of money on the sidelines just waiting to jump in this market. The market won't wait for anyone so with next weeks earnings giving us any sign of a market/economic bottom, we may continue to go higher across the board.

I am thrilled to say I will not get called out on any of the covered calls I've written in the past month- even with this extreme up movement all month! I was smart enough to wait to write the majority of my calls with about 20 days left until expiration. There were a few very close calls such as: the PALM 10's, the APWR 7.50's, the GOOG 410's, the DIG 25's, and several more. I netted a huge profit (free money) for my April covered call options, and I expect to write out the stocks again for May, at an even higher strike price!

Major influences on the market next week will be earnings again with 40% of the DOW 30 reporting. BAC kicks the week off with first quarter results, so we could have another rally considering the new relaxed accounting rules- I am confident they'll beat estimates. However if they upset and miss earnings we could see all the gains in the financials over the past week erased.

Earnings lineup for the week of April 20, 2009:
Monday: Bank of America, Ford and IBM
Tuesday: Caterpillar, Coca-Cola, Du Pont, Merck, Norfolk Southern, Schering Plough, and Yahoo
Wednesday: Apple, AT&T, Boeing, Ebay, McDonalds, Morgan Stanley, QUALCOM, and YUM
Thursday: Amazon, American Express, Amgen, Microsoft, and Potash
Friday: 3M, Honeywell, and Xerox



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