NEW YORK (TheStreet) -- The bullish case? I can't possibly make one, having been expecting a market correction similar to that of April 2012 since April 2013. I'm an inveterate covered-option writer. By nature, I dwell on potential pitfalls of every trade that I make or suggest.
After all, why would you need protection in the form of options if your stock thesis was sound?
After nearly 30 years of marriage, my wife recently told me that only about 40% of what I say turns out to actually be correct. If I was that good at timing stocks, I'd be in the pantheon of the world's greatest investors instead of world's greatest husbands.
Conveniently ignoring my track record of premature pessimism, the coming week holds lots of risk for portfolios.
It was a little disconcerting that the news of what looks like a successful budget deal being reached wasn't greeted with great enthusiasm. In fact, even the architects of the deal seemed to minimize the achievement. Considering Capitol Hill's recent track record, one would be excused for thinking a budget deal well ahead of a deadline was monumental.
Suggesting that the market had simply discounted the deal is convenient, but without basis. Watching House Speaker John Boehner and Majority Leader Eric Cantor rail against the Affordable Care Act while they addressed the nation (fighting yesterday's war instead of rallying the markets by celebrating a rare accomplishment) wasn't helpful.
However, that's yesterday's news and, other than painting a picture of a squeamish market, doesn't offer any forward looking guidance.
Does the coming week's release of the FOMC minutes and, perhaps more importantly, outgoing Fed Chairman Ben Bernanke's press conference to follow, present an immediate risk?
Having sold many options with an expiration date just two days after the FOMC release, I'm forced to recall two other occasions this year when I was smugly anticipating assignment of many positions and counting the cash when the market turned on a dime.
Just a few days ago, there were very few investors believing there was any possibility that the "taper" -- the Fed dialing back $85 billion of bond purchases every month -- could begin or be announced in December. That may be why last week's sturdy employment report was greeted as good news. Without the fear of tapering beginning sooner rather than later, the market rallied. But remember, in the previous days the market sputtered as a synthetic version of tapering, the rising yield on 10-Year Treasury Notes, showed us what is in store when the real thing hits.
While the outcome of what awaits next week isn't preordained, I like to know when obstacles are ahead and what lessons can be learned from the past.
I normally spend Wednesday scouting out potential new positions for next week's purchases in anticipation of weekly option assignments and cash flowing into my account. The question is whether it's time to preserve the cash or simply look for the bullish case that exists elsewhere (but can disappear in an instant).
I don't care about home runs. The names that I gravitate to for short-term plays are only to achieve small returns and the names so often dismissed by those with traditional mindsets.
Listen: No one thumps their chest on their recommended trades about a proposed 1% ROI for the week.
However, eBay (EBAY), Coach (COH) and Caterpillar (CAT) gravitate to the top even when the foundation around them may be weakening. Not because they necessarily have good fundamental stories. After all, they have all had their recent share of derision.
Looking beyond that, these companies have been reliable in their mediocrity and trading range. Collecting option premiums while awaiting assignment, rinsing and repeating with an occasional dividend, can be result in something to thump your chest over.
That range is precisely what makes them valuable to an option seller. While exercising a traditional buy-and-hold approach would have been an exercise in futility in 2013, a punctuated form of ownership, a serial buy and hold technique (characterized by repeated purchases and the writing of calls and assignments) could be an exercise in delight, as seen in returns for eBay, Caterpillar and Coach. The predictability of that range is more reliable than being able to time a rally or decline. The consistency of trading, particularly over the past nine months or so, is the sort of thing that dreams are made of, if you have nothing else to dream about.
They may be boring and out of favor, but sometimes the bullish case is built on the cumulative impact of many baby cows.
As I look toward the challenge of the coming week and the message sent by today's market, I continue my innate pessimism, but am not inclined to shrink back into my shell. Rather, the time seems exceedingly right for small victories shared with old friends.
At the time of publication the author had positions in EBAY and CAT.
This article was written by an independent contributor, separate from TheStreet's regular news coverage.