Friday, June 15, 2007

Friday, Triple Witching Day for the Markets

It's always nice to know when to expect volatility in the stock market. Today, Friday June 15, is just one of those days.
It's a triple witching day, when options, futures and commodities all expire at once. You can expect volatility and profit taking.
Tom S. my stock broker, was kind enough to send me a little piece on it:
"This week is Quadruple Witching Week and that, in and of itself, suggests a high probability of volatility in the markets.
That coincides with the fact that the NYSE Bullish Percent is at high levels and the short term indicators are on sell signals. Quadruple Witching occurs when stock options, futures, futures options, and stock futures options all expire on the same day.
June 15th will be the second triple witching of 2007, the first coming the third Friday in March.
One strategy that we have found that works well during this Quadruple Witching week is if you want to buy a stock put the order in a couple of points below the market, and if you want to sell a stock put the order in to sell a couple of points above the market. Sometimes you get executed on both your buy and sell tickets."
Thanks Tom for keeping me up and educated.
Won't go into anymore detail, but it's nice to know and adjust accordingly. Posts like this don't get many comments, however, I'm a student of the markets and so occasionally want to post what interests me here marketwise.

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