Thursday, August 13, 2009
Saturday, April 26, 2008
filtering next weeks data and making general assumptions
Filtering the upcoming data points and making some very general assumptions can often times prove useful. There are no hard and fast rules that can be made when looking forward ~ other than you must leave room in your outlook TO BE WRONG! If you can't be flexible enough to be wrong, then don't bother even looking ahead, just go about your daily business with your head in the sand! Looking out at least one week ahead is crucial, however, and generally looking out two weeks ahead is even better.
Why is it best to look out two weeks ahead. Simply because markets are discounting mechanisms. Once they discount this weeks data, they start trading off what might happen the following week.
This coming week will close April 2008 and begin May 2008. It will be busy with earnings and economic reports. I have chosen to filter out all earnings reports figuring they will somehow cancel each other out with a general upside bias on balance.
Here are some of my general notes I posted on the week ahead for my website clients.
THE WEEK STARTS OFF GENTLY WITH THE CASE SCHILLER HOME PRICE INDEX ON TUESDAY ALONG WITH CONSUMER CONFIDENCE.
WEDNESDAY IS CHOCK-FULL OF REPORTS BEGINNING WITH THE ECI AND Q1 ADV-GDP. THESE TWO REPORTS WILL BE FOLLOWED BY THE CHI-PMI FOR APRIL AND THEN THE MUCH ANTICIPATED 25 BPS RATE CUT FROM THE FED ALONG WITH A MODIFICATION IN THEIR STATEMENT. MARKET PARTICIPANTS WILL KEY ON THE
STATEMENT FOR CLUES AS TO WHETHER OR NOT TO PRICE MORE RATE CUTS OR NOT.
ON THURSDAY APRIL 1ST WE GET THE ISM REPORT AND THE WKLY JOBLESS REPORT. BOTH THESE REPORTS WILL GIVE US A CLUE AS TO WHETHER THE EXPECTED 95,000 JOB LOSSES MATERIALIZE OR NOT. ANECTDOTAL EVIDENCE FROM
RECENT JOBLESS CLAIMS SUGGEST EXPECTATIONS ARE FAR TOO PESSIMISTIC.
ALL TOLD, EQUITIES WILL LIKELY REMAIN BID INTO THE FOMC ANNOUNCEMENT. EQUITY PRICES TEND TO PEAK ON THESE ANNOUNCEMENTS BUT INVESTORS MUST LEAVE ROOM FOR AN UPSIDE SURPRISE ON NFP FRIDAY TO LIFT EQUITIES INTO
THE FOLLOWING WEEK.
CONVERSELY, THE TREASURIES ARE APT TO REMAIN UNDER PRESSURE INTO WED'S RATE CUT, AND POSSIBLY INTO FRIDAY IF THERE IS AN UPSIDE SURPRISE TO JOBS REPORT. STILL, DOWNSIDE IN TREASURIES SEEM LIMITED OVERALL.
Note the emphasis I placed on the FOMC meeting, and NFP report along with the jobless and ism reports which will give clues to the jobs picture on Friday. In short, for my own purposes, I have decided all else will wind up being little more than market noise. Don't get me wrong, a few of those earnings stories may catch my attention and cause me to jot down a few notes.
The following week features a hawkish ECB meeting on Thursday May 8th which I am overweighting or placing great emphasis on as a potential inflection point for treasuries and equities.
This past week, the BS, lies, that came out ABK's CEO is a warning to all investors in the second half of May. Please take heed of any new developments that they need to raise capital in the bond and equity markets. What happens to ABK in the negative can directly affect the soundness of the entire financial market.
Successfultradingtips.com
Why is it best to look out two weeks ahead. Simply because markets are discounting mechanisms. Once they discount this weeks data, they start trading off what might happen the following week.
This coming week will close April 2008 and begin May 2008. It will be busy with earnings and economic reports. I have chosen to filter out all earnings reports figuring they will somehow cancel each other out with a general upside bias on balance.
Here are some of my general notes I posted on the week ahead for my website clients.
THE WEEK STARTS OFF GENTLY WITH THE CASE SCHILLER HOME PRICE INDEX ON TUESDAY ALONG WITH CONSUMER CONFIDENCE.
WEDNESDAY IS CHOCK-FULL OF REPORTS BEGINNING WITH THE ECI AND Q1 ADV-GDP. THESE TWO REPORTS WILL BE FOLLOWED BY THE CHI-PMI FOR APRIL AND THEN THE MUCH ANTICIPATED 25 BPS RATE CUT FROM THE FED ALONG WITH A MODIFICATION IN THEIR STATEMENT. MARKET PARTICIPANTS WILL KEY ON THE
STATEMENT FOR CLUES AS TO WHETHER OR NOT TO PRICE MORE RATE CUTS OR NOT.
ON THURSDAY APRIL 1ST WE GET THE ISM REPORT AND THE WKLY JOBLESS REPORT. BOTH THESE REPORTS WILL GIVE US A CLUE AS TO WHETHER THE EXPECTED 95,000 JOB LOSSES MATERIALIZE OR NOT. ANECTDOTAL EVIDENCE FROM
RECENT JOBLESS CLAIMS SUGGEST EXPECTATIONS ARE FAR TOO PESSIMISTIC.
ALL TOLD, EQUITIES WILL LIKELY REMAIN BID INTO THE FOMC ANNOUNCEMENT. EQUITY PRICES TEND TO PEAK ON THESE ANNOUNCEMENTS BUT INVESTORS MUST LEAVE ROOM FOR AN UPSIDE SURPRISE ON NFP FRIDAY TO LIFT EQUITIES INTO
THE FOLLOWING WEEK.
CONVERSELY, THE TREASURIES ARE APT TO REMAIN UNDER PRESSURE INTO WED'S RATE CUT, AND POSSIBLY INTO FRIDAY IF THERE IS AN UPSIDE SURPRISE TO JOBS REPORT. STILL, DOWNSIDE IN TREASURIES SEEM LIMITED OVERALL.
Note the emphasis I placed on the FOMC meeting, and NFP report along with the jobless and ism reports which will give clues to the jobs picture on Friday. In short, for my own purposes, I have decided all else will wind up being little more than market noise. Don't get me wrong, a few of those earnings stories may catch my attention and cause me to jot down a few notes.
The following week features a hawkish ECB meeting on Thursday May 8th which I am overweighting or placing great emphasis on as a potential inflection point for treasuries and equities.
This past week, the BS, lies, that came out ABK's CEO is a warning to all investors in the second half of May. Please take heed of any new developments that they need to raise capital in the bond and equity markets. What happens to ABK in the negative can directly affect the soundness of the entire financial market.
Successfultradingtips.com
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