Is it wise to short /long the FTSE/DOW on the back of BB's speech?

[redt]

Is anyone going to do this?

After or during Bernanke's speech at 3PM UK time .

Is it likely we will see a rally in the FTSE/DOW if Bernanke says there will another round of Quantitative Easing and that Markets will tank if he doesnt use more QE


If this is a likely possibility are any of you guys gonna short or long the FTSE / DOW during/after his speech ?

 

[timsk]

Hi redt,
I trade the YM (Dow futures) and I'll treat his speech much like any other news announcement. Generally speaking, for regular news coming out at 3.00pm (U.K. time), I aim to be flat - unless I'm already in a profitable trade and have taken some money off the table - and moved my stop to break even or better. Then I might just take a punt that the market continues on its merry way when the news comes out. But, I admit that's basically just gambling. Once the news is out, I wait and watch the market reaction to it. If it's very volatile and erratic, I'll sit on my hands until things quieten down. If there's a very strong move on huge momentum in one direction, I'll look to fade the move when I can get in with a sensible sized stop - on the grounds that the market tends to over-react and a reversal is probable. In the case of BB's speech, it's a little different to an ordinary news announcement, as the market can react at any time to anything he says. So, I'm going to be very wary and exercise extreme caution (even more than usual!) and assume that the 'normal' rules of engagement are suspended while he's talking. That's my default position, and then I'll act according to how the market itself is responding to whatever he says. The bottom line is that if the moves are 'clean' and tradeable - I'll trade 'em. If they're not - then I won't.
Tim.

 

[tomorton]

Looks like one of those occasions when you sell the rumour and buy the news.

 

[redt]

its quite crazy,

BB announces quiet negative news + poor GDP figues this morning = a small dip then a rally,

how do people predict the FTSE/DOW, seems almost impossible,


as im from the UK i was unable to watch BBs speech live, which was very annoying.
i checjed sky nbews and they didnt say what was said till at least 10 minutes later,
it seems that whats happening in Libya is more important than what will support the economy!

How do people from the UK watch these kind of important announcements LIVE ?

 

[Shakone]

its quite crazy,

BB announces quiet negative news + poor GDP figues this morning = a small dip then a rally,

how do people predict the FTSE/DOW, seems almost impossible,


as im from the UK i was unable to watch BBs speech live, which was very annoying.
i checjed sky nbews and they didnt say what was said till at least 10 minutes later,
it seems that whats happening in Libya is more important than what will support the economy!

How do people from the UK watch these kind of important announcements LIVE ?

I've tried to predict it before, but never been very successful. If it's going up I look for a place to get long, going down I look for a decent place to get short, and then try to manage my trade the best I can. Very little prediction.

 

[tomorton]

redt - Taking a position before any key announcements is always a coin-toss. But you could just watch the charts, staying flat until you can see the direction as timsk says - after all, there must have been thousands of people with huge experience and great amounts of ancillary information, waiting to commit huge funds based on what Ben said - when they form a consensus, that's the way the market moves and the signpost to the rest of the world is drawn on the chart. Maybe successful trading is less about successful prediction, more about successful reaction.

 

[dc2000]

Is anyone going to do this?

After or during Bernanke's speech at 3PM UK time .

Is it likely we will see a rally in the FTSE/DOW if Bernanke says there will another round of Quantitative Easing and that Markets will tank if he doesnt use more QE


If this is a likely possibility are any of you guys gonna short or long the FTSE / DOW during/after his speech ?

trade it absolutely but as with all Burncakes speaches they are leaked ahead of time the no QE3 was priced in yesterday

 

[Trader333]

how do people predict the FTSE/DOW, seems almost impossible,

They don't and you will do well to ignore any predictions.


Paul

 

[redt]

cheers,

in that case how do you confidently place a trade when you have no idea which way its gonna go?

even with a steady uptrend or downtrend there are bound to be profit takers / bargain hunters?


And how is confidential information leaked to institutions / people in the business Legally?

surely any imformation released by a government is 100% confidential untril they announce it?

would it be wise to view erratic share price / index movement in one way or the other as '100% Certain information has been leaked or is known' ?

So if GDP figures were out the following day and we see a big sell off, its guaranteed they will be negative GDP figures?

seems a bit unfair to me

how does one hear or read a bout this leaked information first or at the time the first leak is announced or circulated?
is there websites you know that reveal these leaks?

 

[DaddyJohn]

its quite crazy,

BB announces quiet negative news + poor GDP figues this morning = a small dip then a rally,

how do people predict the FTSE/DOW, seems almost impossible,


as im from the UK i was unable to watch BBs speech live, which was very annoying.
i checjed sky nbews and they didnt say what was said till at least 10 minutes later,
it seems that whats happening in Libya is more important than what will support the economy!

How do people from the UK watch these kind of important announcements LIVE ?

You could try Bloomberg live tv, or subscribe to a squawk service, which is what I do. I decided to stay away from my desk on friday, you just never really know how the ,market will react . The bulls will always find some way of interpreting in their favour as will the bears. This leads to volatility that makes it difficult as a day trader to assess where your risk starts and ends, so I don't get involved. You could see some of this starting on Thursday with the stupid rumours of the Germany downgrade and markets following the dax due to other rumours on short selling bans. Best wait and be patient, there is always better days.

 

[DaddyJohn]

Truth is you can never know, news flow is clearly leaked, which ones and when you will never know. You also have the added factor that many large institutions try and forecast what the numbers will be, however you can use this to your advantage. E.g recently the Market has got it completely wrong on non farm payrolls, so if you see strong price action in one direction based on a belief the numbers will be good, but the number turns out horrible, then hey presto you have a great opportunity. But you need a fast dma type execution system to do this or slippage will be bad.

Unfortunately news leakage is a fact of life in the markets, it is unfair, but as traders we have to find a way to deal with it.

QUOTE=redt;1657940]cheers,

in that case how do you confidently place a trade when you have no idea which way its gonna go?

even with a steady uptrend or downtrend there are bound to be profit takers / bargain hunters?


And how is confidential information leaked to institutions / people i Legally?


surely any imformation released by a government is 100% confidential untril they announce it?

would it be wise to view erratic share price / index movement in one way or the other as '100% Certain information has been leaked or is known' ?

So if GDP figures were out the following day and we see a big sell off, its guaranteed they will be negative GDP figures?

seems a bit unfair to me

how does one hear or read a bout this leaked information first or at the time the first leak is announced or circulated?
is there websites you know that reveal these leaks?[/QUOTE]

 

[YouAreNotFree]

Why so coy Benny boy?

You know it. We know it. QE3 is coming.

 

[mrfigure]

I think one needs to weigh up the news that has been released and the timing of it. I recall not long ago waking up and putting sky news on. It was released that the german economy had slumped and upon looking at the germany 30 chart, that news did not appear to be priced in. I opened a £100pp short position and took a £2,000 profit literally 10 minutes later. Usually though I avoid trading the news.

 

[redt]

cheers

looks like to me that its wise to follow trends instead of being a trend setter

nice timing mrfigure!

Does Bloomberg TV show all the UK and US business announcements and figures like non farm payroll - retail sales CPI, GDP, etc
does bloomberg tv show a live stream of results being announced?

 

[mrfigure]

Just my opinion but the major trend should always be followed, it is down to the trader to identify when price is on a pull back and is at/near support or rallying and hitting resistance. My advice would be not to trade the news as the markets react in ways nobody can predict, trend or not. It is also difficult to gauge the impact of such news. My method is to sit back and let the impact of significant news settle in and then monitor to ascertain if the trend is now continuing. You have to be very confident to judge whether to trade a news release. I was confident that the dax would drop on the news that the euros biggest economy had taken a hit...the likelihood the dax would rise on this news was slim I would say !! It was the timing of my trade that gave me the confidence, because the news was fresh. Not all traders find themselves in a position like that. I find the best way to receive news is to link an rss feed via email into the major media netwoeks such as bloomberg, routers, sky news etc

 

[debrox]

I've ran the analysis, long it.