It is very interesting phenomena. The Market is really a Veto Machine. We just can not do a “Fundamental Analysis” to see whether company is worth to buy or not. When the market crashed due to SubPrime Mortgage Histeria, many good stocks that have good earnings results were also Plummeted to new low. I saw this on Technology stock such as AAPL and GOOG. No matter how good the analysts view on these two stocks, 70% of their down performance were affected by the market.
The stocks and indexes were corrected and rebound again just because of “WHISPER” from the FED that they plan to cut the interest rate again about a quarter or half percent. Just because Bernanke and his assistant made commitments, market rallied quite vigorously.
My previous writing suggested that I will sit tight and see for market confirmation after the FED decided on lowering the interest. And it was right…., despite the FED cut a quarter point, the market was still “DOWN”, just because investors are expecting more than a quarter cut…..Don’t you think the Market Bullied Bernanke???
This is the third time Fed is cutting the interest rate in a row in order to make the econonomy active. Whether this move will be success or not, let us see what is happening in the near future, but everybody know that the INFLATION is a GHOST to the American Worker. So, who is benefit with this situation? Yes….. you bet, the Short Term Trader. The more volatile the market the better they are. However, it is not for Write Options Strategy. We really need moderate volatility in order make our position safer.
I still believe that during this period, Trade Small and look for market direction for confirmation. Don’t make any big bet since the signal is mixed à where the market rally does not conform with the Sub Prime problems. One week ahead is December Options Expiry date and maybe it is good to look opportunies on short tenor trading. As the VOLATILITY is HIGH, there will be good premium to SELL OPTIONS……
The stocks and indexes were corrected and rebound again just because of “WHISPER” from the FED that they plan to cut the interest rate again about a quarter or half percent. Just because Bernanke and his assistant made commitments, market rallied quite vigorously.
My previous writing suggested that I will sit tight and see for market confirmation after the FED decided on lowering the interest. And it was right…., despite the FED cut a quarter point, the market was still “DOWN”, just because investors are expecting more than a quarter cut…..Don’t you think the Market Bullied Bernanke???
This is the third time Fed is cutting the interest rate in a row in order to make the econonomy active. Whether this move will be success or not, let us see what is happening in the near future, but everybody know that the INFLATION is a GHOST to the American Worker. So, who is benefit with this situation? Yes….. you bet, the Short Term Trader. The more volatile the market the better they are. However, it is not for Write Options Strategy. We really need moderate volatility in order make our position safer.
I still believe that during this period, Trade Small and look for market direction for confirmation. Don’t make any big bet since the signal is mixed à where the market rally does not conform with the Sub Prime problems. One week ahead is December Options Expiry date and maybe it is good to look opportunies on short tenor trading. As the VOLATILITY is HIGH, there will be good premium to SELL OPTIONS……
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