7:20AM EST While you will see very little about this on the financial news networks, the key driver today will be the dollar, as it has been for the past several weeks. This weekend, a Russian official stated that there was little in the way of options for a world currency standard in the near future. This was extremely bullish for the dollar, which is ultimately bearish for most other markets in the US and around the world. A weakening dollar has been supportive for the commodity markets, which have risen in the face of weak-at-best fundamentals. This has therefore been supportive for equity markets which want to rise at any indication of potential economic recovery.
Maybe we get the strong, healthy pullback I have been looking for in the equity markets this week. As I mentioned in previous posts, we need to get a nice little pullback to keep this rally going.
I have one trade I am going to look at today. The stock is Rigel Pharmaceuticals (RIGL). This trade is highly speculative and should only be done with options using small amounts of capital. They have clinical trials coming out about their Rheumatoid Arthritis drug. The market is anticipating positive results for this trial based on the action of the stock. I am looking at the September $17.50 Calls. They can be bought for about $1.75 right now. They can easily double or more with a positive result from trials. They can also be cut in half with a negative result. It is still a 2:1 risk/reward ratio. I definitely like those odds. Until next time, stay low risk..
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