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As we near get into the final week of trading in 2008, the CNBC Million Dollar Challenge contestants who have topped the leader board are those who have embraced trading the inverse and ultra ETFs. They are using them to trade the up and down moves in the market and capturing the short-term swings. That's been a big help these days as the overall market has been pretty directionless for the past two weeks, capturing the short-term swings.
Gasoline inventories continue to increase, indicating that either consumers are buying less or refining capacity is on the rise. Today's EIA weekly petroleum inventories report showed that refineries were operating at 84.7% of capacity, which is very close to the capacity they've been running at for the past month. If people are buying less gas, which is half the price it was a couple months ago, that means they potentially have more money to spend on toys for the holidays. The consumer spending data showed that it declined less than expected in November, and increased for the first time in six months when adjusted for inflation. Jobless claims continue to rise, which means that the December spending and retail sales data might be weaker. I expect to see good economic data balanced by bad for the foreseeable future. That could mean more choppiness in the market, and more potential for the contestants who are adept at using the inverse ETFs.
Happy Holidays everybody!
Tom Preston
thinkorswim, Inc.
Member FINRA/SIPC/NFA
thinkorswim, Inc. and its registered employee, Tom Preston, do not solicit or recommend any form of trading in the individual stocks (or their derivatives) mentioned above. Please do careful, independent research before investing any money as well as weigh the possible consequences on your particular financial situation before doing so. The risk of loss may be substantial.
