War Rally Already Happened???

Discussion in 'Trading' started by Corso482, Mar 18, 2003.

  1. Everyone is expecting a huge rally once the bombs drop.

    Is this like the January effect becoming the December effect then the Novermber effect etc.?

    If everyone expects there to be a rally once war starts, then it makes sense that all they were waiting for to get in early would be confirmation of impending war. We got that. Bush gave his 48 hour speech. The market rallied. Bada Bing. Was that the war rally?

    So the war rally was really the pre-war rally, making the war rally really the war decline?

    Opinions would be interesting.
  2. there sure could be a war decline with this big runup ahead of it. you know the news media will do its best to scare the market.
  3. When the entire world is expecting the same thing to happen, the market has a perverse way of doing the opposite.
  4. I closed out several positions today:
    Bought to Close 3 NDX Apr 800 Puts @ 1.4
    Sold to Close 5 MNX Jun 80 Calls @ 28.8

    I do not make predictions, but I am mostly short Calls now.
  5. You are thinking too much Corso - also seem to assume the market is more efficient than it probably is.

    Think about it: What is the goal of our Iraq operation? To remove Saddam at the lowest cost. Don't overlook this fact: Saddam will get much of his real-time war news from CNN. As such, coalition force commanders will be giving regular, choreographed 'briefings' describing the the efficient execution of an unstoppable force, just like Stormin' Norman and Powell did in 1991. Monday's WSJ also described how, before we even engage Baghdad fully, British forces will be tasked with 'liberating' Basra in the south. Plan is for choppers to fly in journalists to record Shi'ite Basra's warm welcome of British forces. Footage is meant gain support at home and undermine confidence in Baghdad.

    My bet is that coalition forces will skillfully use media coverage to their advantage, and that the 'animal spirits' of market participants will be stirred more than most of us can appreciate now. I expect strong rally as the march to Baghdad progresses and then a potential sell-off in the ensuing months.