No one can predict the future. Put on your stop loss incase things dont go your way and take it easy.
This was posted in the economics forum by austinp. "I traded thru the pair of surprise rate cuts in Jan and Apr 2001. Both were bonafide fed-fund rate cuts, both ramped price action as one would expect. Both sold off within a day or two which led to considerably lower lows from there. No idea which way the market goes from here. If it holds Thursday's close = Friday's low and keeps marching upward, I'll buy it. But... if they take out Friday's lows and close below there Monday or Tuesday, we will probably see SPX 1300ish soon after. Fed gave a half-hearted shot with its faux rate-cut on option expiry Friday, purposely meant to juice the stock market. That had nil to do with providing credit liquidity... it was timed to blow out maximum stock shorts and give people something to talk about over the weekend. The next couple sessions ahead are pivotal. Hold Friday lows = sideways to higher. Break below Friday lows, especially on a closing basis and S&P 1300 or lower is next - austinp"
Bad move, spert. Cover monday morning first thing but it will be too late when eveything gaps up huge. Yea you got p0wn3d.
the closing action on those daily bars.....negating that tail & closing firmly in the top 3/4 of that bar was critical for bulls imo,i expect a walk up on lo vol... may last a couple of days imo or more.....but a matter of time before we nose dive a lower lo on spx on increased vol.sentiment has changed last week as i`ll be patiently awaiting a reversal bar to ride.i`ll be looking for that RB somwhere between 1455/60 spx where the 20d & 200day are sitting in close proximity..........if we get past that 1480/90 level.
sidenote...the larger the timeframe,the more significant the move typically.....with lower vol,it will be less difficult to put in an "outside day" ...taking out the hi & lo of previous day like AP was referring to.that`s the primary setup i`ll be watching for....along with 15,30 & 60 min for the begginings of the bigger setup.
Never fight the fed. Right now we will not know what the fed will probably do until september. Chances are the market will move up from here until that meeting. Volatility will probably drop from now until that meeting. If he doesn't cut rates, your shorts will do great, but I would rather be short closer to that meeting than being short right now.
I took a position in DXD whent he DOW was up 300+ at 52 sold it at 53, will buy it back around 50-51. Today should be a bit interesting, I heard on cnbc today that its going to take some really, really negative news to take the DOW back down below 12750 again. Many think the bottom was put in last week when the DOW fell nearly 350 points and recovered by the close. Again, how is it possible that a correction of 10% can be done in a matter of only 2-3 weeks.
There will BE NO CUT at the September meeting. These bulls are crying like babies to get the federal reserve to act on problems created by the markets. The markets created this credit bubble and should learn to correct the problem without the federal reserve stepping in.
I was in the "no way we see a Fed cut in September" camp before. Now I'm not so sure. I still believe a cut would be a major mistake, and I have a hard time coming to terms with Bernanke making a major mistake like that. But perhaps he sees something I don't. Regardless, I'm on the fence with what he will do, not what he should do. What he should do is easy to see.