The ACD Method

Have a bit of time to spare so I thought I'd put this together.

Final poll tracker for the French Presidential elections.

http://www.telegraph.co.uk/news/0/french-presidential-election-poll-tracker-odds/

I think the Macron/Le Pen scenario has been priced in with the recent Euro strength. An exceptional margin by Macron might see some upside, otherwise I wouldn't be surprised by some selling after the fact and a bit of wait and see. After that late terror attack, it is likely there will be more issues before the inevitable second round and some may choose to take profits and wait and see for a while. IS would dearly love Le Pen to win, likely more alienation of French Muslims in the banlieue and more recruits, and lone terror attacks are pretty impossible to stop.

Downside risk would be Le Pen winning with Macron going through. Serious downside would be Le Pen and Fillon going through, or worse, Le Pen and Melenchon.

Point to remember is most polls have come in within the margin of error, so they are about as useful as the Brexit and US election polls.

For those of you not trading anything directly influenced by this election but want to watch the show, here is a quick guide to the candidates, just get your popcorn ready.

https://twitter.com/x/status/854710935243698177

Exit polls should come in around 2:00 p.m. EST Sunday, but with the polling so close, it is uncertain if we will have a clear indication by the New York open 5:00 p.m. EST.

Enjoy, and good trading all.
 
justrading said:
Have a bit of time to spare so I thought I'd put this together.

Final poll tracker for the French Presidential elections.

http://www.telegraph.co.uk/news/0/french-presidential-election-poll-tracker-odds/

I think the Macron/Le Pen scenario has been priced in with the recent Euro strength. An exceptional margin by Macron might see some upside, otherwise I wouldn't be surprised by some selling after the fact and a bit of wait and see. After that late terror attack, it is likely there will be more issues before the inevitable second round and some may choose to take profits and wait and see for a while. IS would dearly love Le Pen to win, likely more alienation of French Muslims in the banlieue and more recruits, and lone terror attacks are pretty impossible to stop.

Downside risk would be Le Pen winning with Macron going through. Serious downside would be Le Pen and Fillon going through, or worse, Le Pen and Melenchon.

Point to remember is most polls have come in within the margin of error, so they are about as useful as the Brexit and US election polls.

For those of you not trading anything directly influenced by this election but want to watch the show, here is a quick guide to the candidates, just get your popcorn ready.

https://twitter.com/x/status/854710935243698177

Exit polls should come in around 2:00 p.m. EST Sunday, but with the polling so close, it is uncertain if we will have a clear indication by the New York open 5:00 p.m. EST.

Enjoy, and good trading all.
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The real market mover is going to be the margin of the top finisher. The market is watching the 30% level for LePen. The market does NOT want her to exceed 30%. The second number they are watching is 5%. If LePen would come in first by a 5% or higher margin, then this would also be bearish. The third number I would look at is the total of Melenchon and LePen. If they combine for over 50%, we're in trouble. LePen would likely capture a lot of Melenchon's supporters in the 2nd round on May 7th.
 
Maverick74 said:
The real market mover is going to be the margin of the top finisher. The market is watching the 30% level for LePen. The market does NOT want her to exceed 30%. The second number they are watching is 5%. If LePen would come in first by a 5% or higher margin, then this would also be bearish. The third number I would look at is the total of Melenchon and LePen. If they combine for over 50%, we're in trouble. LePen would likely capture a lot of Melenchon's supporters in the 2nd round on May 7th.
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So are you long a bunch of PUTs on the Euro Mav? I am not following this thing closely but you know Le Pen will exceed 30%. If you don't want to publicly talk about your position then I will understand 100%. I know this is not the politics forum but I am rooting for Le Pen! Either way good luck with your trade.
 
Maverick74 said:
The real market mover is going to be the margin of the top finisher. The market is watching the 30% level for LePen. The market does NOT want her to exceed 30%. The second number they are watching is 5%. If LePen would come in first by a 5% or higher margin, then this would also be bearish. The third number I would look at is the total of Melenchon and LePen. If they combine for over 50%, we're in trouble. LePen would likely capture a lot of Melenchon's supporters in the 2nd round on May 7th.
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Good points, in a race too close to call and a poor recent record by the pollsters, it will be all about the nuance and all it implies. If Macron's lead is as real as Remain and Clinton's, we're in for an interesting ride.
 
MoneyMatthew said:
So are you long a bunch of PUTs on the Euro Mav? I am not following this thing closely but you know Le Pen will exceed 30%. If you don't want to publicly talk about your position then I will understand 100%. I know this is not the politics forum but I am rooting for Le Pen! Either way good luck with your trade.
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I'm now short option vol in the Euro land. I actually have some upside and downside exposure in Euro. Basically looking for a big move in either direction. Regarding LePen, there are 4 major candidates, another 4 secondary tier and a few additional ones that we can probably ignore. It will be very hard to break the 30% threshold, even the 25% threshold will be close. IF she did break 30%, the Euro will get smacked hard as will our equity markets. I have a pretty convoluted position that involves the Euro, Bonds and US index futures that covers "most' of the scenarios.
 
Maverick74 said:
I'm now short option vol in the Euro land. I actually have some upside and downside exposure in Euro. Basically looking for a big move in either direction. Regarding LePen, there are 4 major candidates, another 4 secondary tier and a few additional ones that we can probably ignore. It will be very hard to break the 30% threshold, even the 25% threshold will be close. IF she did break 30%, the Euro will get smacked hard as will our equity markets. I have a pretty convoluted position that involves the Euro, Bonds and US index futures that covers "most' of the scenarios.
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Oh that's right, you are short vol because of the built in edge of time decay/theta. LOL, just kidding..I know that is a pet peeve of yours...people who think selling vol is a gravy train. Not that it means anything but good luck. I will sit safely on the sidelines watching.
 
jokertrader said:
Good luck Mav.. i have a scenario short vol in Euro and short SPY we shall see.. ha ha
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Quite so, the most elegant analysis is just that, and the markets will do what they will.

If an elegant analysis meant guaranteed profit, every hedge fund would always make money.

The nice thing about being retail is you can be all in within seconds and not move price.

On the Brit snap election announcement, I wasn't trading, just on my phone I traded and made 1.90R with an extra wide stop. Funds can't do what we do.

http://uk.reuters.com/article/us-britain-election-hedgefunds-idUKKBN17M2WF
 
MoneyMatthew said:
Oh that's right, you are short vol because of the built in edge of time decay/theta. LOL, just kidding..I know that is a pet peeve of yours...people who think selling vol is a gravy train. Not that it means anything but good luck. I will sit safely on the sidelines watching.
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Well, I constructed a position that acts like a long straddle while technically being short vol. The profits are going to come from the movement in the Euro, not from being short vol. The levels in vol just allowed me to move my strikes further out. It's a little more complicated then just selling vol.
 
Maverick74 said:
Well, I constructed a position that acts like a long straddle while technically being short vol. The profits are going to come from the movement in the Euro, not from being short vol. The levels in vol just allowed me to move my strikes further out. It's a little more complicated then just selling vol.
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Sorry, I did not mean to reduce your research and insights into simply "selling vol".
 
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