Futures Going To Get Killed Tonight!!!
- Thread starter BlueStreek
- Start date
At least my 2 contract overnight es trade that I took long after the market closed for a 2 point profit before the open since I was not using a stop and planned to dollar cost into it some more if it went against me around supports.
Now, feel free to let the market fall 200 points.
Now, feel free to let the market fall 200 points.
The dow down 60 on just terrible news...then up 45 on no news....and in 10 minutes down 4 for the day....yet futures 23 points higher than levels they couldn`t sustain during regular trading hours. All with the worst economic reports and speakers taking center stage friday with a massive snowstorm coming east. This market has gotten very "irrationally exuberant" right now where all the bs spin that energy prices have helped the consumer....(numbers said otherwise), energy prices moderating (not really) economy is performing well (not according to durable goods) and on and on.....bernanke will have to address the fact that there is high divergence between the fed`s stated inflation fighting policy and the bond market`s expectations from the fed. I look for tough talk out of three fed speakers tomorrow, or else the crash will just be even more dramatic once it occurrs.
These markets have been goosed up right here and are so full of hot air that we are looking at over a 1,000 point drop just to get back to reasonable valuations considering we are starring right down the barrell of decelerated growth prospects for the forseeable future (namely, the first two quarters in 2007).
The real kicker which everyone has completely wrong is that the fed will not be able to cut rates to save housing, in fact, it looks like they will have to raise rates in 2007, and this fact is not being priced into the bond markets, gold markets, currency markets or the equities.
When this bubble crashes, and people start defaulting on the loans they borrowed from various credit sources (carry trades), to invest in higher returning places like the equity markets, which they thought would subsidize these loans through 25-40% returns, the dow could easily drop 2,000-3,000 points from here.
We are going to have painful reverberations throughout the credit community as a result of this irrational liquidity and cheap capital SLOSHING AROUND RIGHT NOW.
This is very similar to the craziness of the ARMS finacing of the housing bubble that we haven`t begun to face up to yet when those hit the market next year.
People fall into the same patterns of 'irrational exuberance' towards the end of every bull market!
These markets have been goosed up right here and are so full of hot air that we are looking at over a 1,000 point drop just to get back to reasonable valuations considering we are starring right down the barrell of decelerated growth prospects for the forseeable future (namely, the first two quarters in 2007).
The real kicker which everyone has completely wrong is that the fed will not be able to cut rates to save housing, in fact, it looks like they will have to raise rates in 2007, and this fact is not being priced into the bond markets, gold markets, currency markets or the equities.
When this bubble crashes, and people start defaulting on the loans they borrowed from various credit sources (carry trades), to invest in higher returning places like the equity markets, which they thought would subsidize these loans through 25-40% returns, the dow could easily drop 2,000-3,000 points from here.
We are going to have painful reverberations throughout the credit community as a result of this irrational liquidity and cheap capital SLOSHING AROUND RIGHT NOW.
This is very similar to the craziness of the ARMS finacing of the housing bubble that we haven`t begun to face up to yet when those hit the market next year.
People fall into the same patterns of 'irrational exuberance' towards the end of every bull market!