Sparkling profits and spectacular losses...

[Jake Leo]

I've thought about doing this for a while, I trade S&P futures and I will be posting all my orders / trades as soon as I place them in the market, prices and sizes! And as the title suggests I either make sparkling profits or spectacular losses... there is often very little middle ground with me! Unfortunately, I've just set up the blog on...
http://daytradingjournal.wordpress.com
but I might replicate it here as well. This will either be a very short lived embarrasing episode, or with any luck something that might last a little longer!
Either way I hope it will be amusing! I will endevour to post all order and completed trades within 5 mins or sooner.
Comments, suggestions or support, or any combination of the three will be much appreciated!

 

[TheBramble]

Will you be stating the basis for taking and exiting each trade and the reason you place your targets and stops where you do - or will you just be posting the trades?

 

[Jake Leo]

There are brief explanations on my methodology, but as I’m trying to post trades as soon as I place an order or when they’re executed, it would be difficult to have the time to give detailed explanation of every trade. However, if there are any questions on any of my individual trades I would be happy to answer them.
For your reference the main technical methods I use are, mean reversion on Bollinger Bands, stochastic oscillator and Wells Wilder…
I think there are plenty of traders that can offer far better explanations than I can on trading methodology, this is more of a raw front line journal of giving an account of, great to disastrous trades, and everything that goes in between…

 

[Jake Leo]

Ahead of the Fed Rate Decision

Does the US equity market always go up on the day of a cut? Does anyone have any statistics on when this has not been the case, and the market has fallen???

 

[Hoggums]

Does the US equity market always go up on the day of a cut? Does anyone have any statistics on when this has not been the case, and the market has fallen???

I don't know for certain but I would guess generally yes. Cutting rates is good for business - they pay less interest on debt - therefore higher profits. Also investing in cash products becomes less attractive and investors looking for return on their money are more likely to go to the equity markets.

 

[Rhody Trader]

I don't know for certain but I would guess generally yes. Cutting rates is good for business - they pay less interest on debt - therefore higher profits. Also investing in cash products becomes less attractive and investors looking for return on their money are more likely to go to the equity markets.

All your rationale for rate cuts being positive for stocks are good, and you can add it the somewhat mechanical fact that rate cuts mean lower discounting rates used in valuation models, which means higher valuations. That all said, though, rate cuts are generally already priced in to the market before they actually happen.

 

[Jake Leo]

What's baked into the market?

I don't know for certain but I would guess generally yes. Cutting rates is good for business - they pay less interest on debt - therefore higher profits. Also investing in cash products becomes less attractive and investors looking for return on their money are more likely to go to the equity markets.

Thanks for your reply. I suppose what I'm thinking is this...

25bp has already been baked into the market, there has been also talk of 50bp, so the market has moved up on the back of this as well

Q3 Advance GDP Deflator today was 3.9% (expected was 3.1%)

Therefore if we only get 25bp, and the fed comments are neutral (likely I think on the back of the GDP figures), then are we looking at a toppy US equity market?

 

[Jake Leo]

Thanks for your reply. I suppose what I'm thinking is this...

25bp has already been baked into the market, there has been also talk of 50bp, so the market has moved up on the back of this as well

Q3 Advance GDP Deflator today was 3.9% (expected was 3.1%)

Therefore if we only get 25bp, and the fed comments are neutral (likely I think on the back of the GDP figures), then are we looking at a toppy US equity market?

mind you... I might be just talking my own book! lol

 

[Trader333]

Does the US equity market always go up on the day of a cut? Does anyone have any statistics on when this has not been the case, and the market has fallen???

There has been no rate cut yet. The presumption is that there will be one but stranger things have happened and making assumptions in trading is fraught with danger.


Paul

 

[Jake Leo]

There has been no rate cut yet. The presumption is that there will be one but stranger things have happened and making assumptions in trading is fraught with danger.


Paul

Thanks Paul... I probably have to agree with you

 

[Hoggums]

There has been no rate cut yet. The presumption is that there will be one but stranger things have happened and making assumptions in trading is fraught with danger.


Paul

3rd'ed - I've made a nice tidy profit from the speculation - but now I'm completely out of the market - I'll re-enter tomorrow - maybe. I think the only way I could profit further now is if the fed cut by 0.5% which I don't think is likely enough for me to risk money on. I think a 0,25% cut is most likely which is now already priced into the markets.

BTW well done rossored.

 

[Jake Leo]

Is there a case for continued weakness in the US$ ???

After the very much expected 25bp cut yesterday, and the Fed now saying it will turn back to the issue of inflation, suggesting the chances of another cut at the next meeting are lower. Does anyone have any thoughts on continued further US$ weakness?
(I'm currently short £/$ and surprised we are still at these levels 2.0790 and not lower!)