Bond Traders Continue Retreat...
The Dow continued its neutral trend today as it retreats by 98 points from a lack of follow up on yesterday's "Fed Rally". What the Fed did certainly didn't impress investors as Bond Traders resumed their flight to quality, depressing bond yields to historical lows again (see bond yield curve). The market was depending on bond traders to come back into equities due to the low yields in order to provide the support and thrust it needs but it looks like its not going to happen after all. This makes the possibility of a Santa Claus Rally very slim. Obviously these 2 weeks have been great for Neutral Options Strategies but pretty dry for stock traders. However, I do expect a significant change of tone in the market once we leave 2008 behind us and look forward to what the January Effect of 2009 can bring.
Labels: 2008 crash, fundamental analysis, technical analysis
posted by Jason Ng at 7:29 PM
1 Comments:
Yes. certainly agreed that this past weeks has been a great time for neutral options strategies.
I put on 3 iron condors of different max profit and they have been profitable. From the way the intraday charts look, it does look like the market has a clue and neither bulls or bears are in charged.
Seems like there may not be a breakout till after the new year.
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