Rate Cut = Goodbye Volatility

Discussion in 'Trading' started by CaliforniaKid23, Dec 1, 2007.

  1. What will happen to volatility if we get a .50 rate cut or even a .25? Last september's rate cut killed the volatility for weeks - i remember how boring and unprofitable it was trying to day-trade the Qs. so, now if we get a rate cut, I am thinking of switching to swing trading and buying QQQQ call options and not worry about watching the market. is that a good idea this time?

    Will the volatility disappear after Dec 11th? if so...how does a day-trader adapt to those conditions? Can anyone share a few insights or advice. thankyou!
  2. Mvic


    Why not just wait and see what the reaction is on Dec 11th? It might be that the rate cut has already be priced in or that the Fed doesn't have credibility or that the Fed doesnt cut? The reaction will be very telling either way and will give you a better basis for making a decision.
  3. The market should be "calmer" between now and January 2nd because of the Holidays. The first week of 2008 should be "jumpier" because of retirement fund buying and carryover tax-related selling. We'll see.