Friday, February 11, 2011

Market Review

Last night saw the markets fall off in the futures markets, then recover to close slightly higher.

However the risk-off sentiment is coming through in the intermarket prices - USD rising across currencies - AUD, EURO, YEN all subject to weakness and potential trades have come through. Last night I bagged my first target on a risk managed trade, by going long the USDYEN pair.

The underlying technicals remain weak - and the Egypt issue still looms. After doing some reading on political and global trade implications of Egypt, and the current unresolved Mubarak - I have rethought the impact of Egypt and feel that the Suez trade which is critical to the oil situation, then we will have some great trading opportunites due to volatility. The key is knowing which direction to trade it. I suspect higher oil/gold prices with higher USD - which may see a short term de-correlation between the commodites/USD.

In terms of earnings, euro companies are looking to be issuing weaker reports, and US companies are reporting much better reports on average.

Last night before the US markets opened, there was a rumour concerning Paul Tudor Jones calling a market top in which his PR team promptly denying the rumours - the market recovered the premarket drop by sessions end.
However, the RIO news overseas of a buyback less than expected, I was expecting some selling down on the asx200 market and I was able to sell a good offer @ 4904 before closing the contract at the sessions end at 4890. The sessions end was perhaps a good way to close the position, although the position was 20 points more profitable if I had waited after-market.