Short DAX at 7740
- Thread starter ASusilovic
- Start date
JSSPMK,
you remember our good old "reversion to the mean" expectations our friendly neighbourhood Quants are always looking for ? Well, in a way I welcome the volatility since early June 2007, but the observation of 8-10 % up / down days for certain stocks makes me think of an major reversal pattern occuring in the long run - as we have learned these kind of voltatility eruptions occur at major highs or lows.
As such I would agree with your expectation that there might be some more downward pressure on stocks and indices in the U.S. as consequence.
BUT !!!!....
keep in mind that investing has always to do with comparing alternatives ! T-Notes yields at 3,84 %. Real estate market is most probably the wrong place to be in right now. Commodities seem to be an viable alternative for stock investments ( take a look at Copper development today ! ). Currencies look extremely attractive in regards of expected actions by FED, ECB etc.
Also helpful is a look at worldwide markets. Are we in "recession mode" in Europe, Asia, South America ? I go against the view that the U.S. market is responsible for the well-being of the global economy ! We still see very good growth rates in emerging markets - although some commentators warn about some of them might "overheat" and are heavily indebted.
Funny enough, the FED is predicting no recession and even citing inflation concerns as more urgent then growth.
So, it will be fun to see who´s macro staff is better at work : FED or Wall Street IB´s. Personally, I keep it with the FED. Never fight the FED ! Ha, ha, ha....
Regarding short term outlook :
we´re almost too far from the mean...we may see some more downward pressure in the next couple of days, but chances very high of a decent upward move...
you remember our good old "reversion to the mean" expectations our friendly neighbourhood Quants are always looking for ? Well, in a way I welcome the volatility since early June 2007, but the observation of 8-10 % up / down days for certain stocks makes me think of an major reversal pattern occuring in the long run - as we have learned these kind of voltatility eruptions occur at major highs or lows.
As such I would agree with your expectation that there might be some more downward pressure on stocks and indices in the U.S. as consequence.
BUT !!!!....
keep in mind that investing has always to do with comparing alternatives ! T-Notes yields at 3,84 %. Real estate market is most probably the wrong place to be in right now. Commodities seem to be an viable alternative for stock investments ( take a look at Copper development today ! ). Currencies look extremely attractive in regards of expected actions by FED, ECB etc.
Also helpful is a look at worldwide markets. Are we in "recession mode" in Europe, Asia, South America ? I go against the view that the U.S. market is responsible for the well-being of the global economy ! We still see very good growth rates in emerging markets - although some commentators warn about some of them might "overheat" and are heavily indebted.
Funny enough, the FED is predicting no recession and even citing inflation concerns as more urgent then growth.
So, it will be fun to see who´s macro staff is better at work : FED or Wall Street IB´s. Personally, I keep it with the FED. Never fight the FED ! Ha, ha, ha....
Regarding short term outlook :
we´re almost too far from the mean...we may see some more downward pressure in the next couple of days, but chances very high of a decent upward move...
AS, TY for posting your outlooks.
I would like to post a couple of charts, first one is from today's 2 min fDAX session where there was a pattern very similar to the one I traded yesterday via ES, I didn't post this in real-time as ET's servers must have got themselves a bargain over at Lastminute.com
So here is a very straightforward rising wedge plus a slant divergence, took 2 trades to nail the breakdown. Here is the visual.
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1741647>
I would like to post a couple of charts, first one is from today's 2 min fDAX session where there was a pattern very similar to the one I traded yesterday via ES, I didn't post this in real-time as ET's servers must have got themselves a bargain over at Lastminute.com
So here is a very straightforward rising wedge plus a slant divergence, took 2 trades to nail the breakdown. Here is the visual.
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1741647>
Quote from ASusilovic:
JSSPMK,
you remember our good old "reversion to the mean" expectations our friendly neighbourhood Quants are always looking for ? Well, in a way I welcome the volatility since early June 2007, but the observation of 8-10 % up / down days for certain stocks makes me think of an major reversal pattern occuring in the long run - as we have learned these kind of voltatility eruptions occur at major highs or lows.
Hi Jssmpk & ASusilovic
1. I studied that markets never fall out of fear but out of greed.
2. The real estate and the finance crises is a very serious thing, but so far you got no earning warnings, p/e very reasonable, imported profits from the BRIC ( platform economy ) etc...
3. Inflation ( at normal range ) is a sign of buying power ( we all think it's negative ).
4. The global liquidity + global strong growth + low interest rates creates Lots of money looking for good investments.
In my opinion it will stay very volatile in the next few months within this ~range. ( but who knows ...