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Thread: FOMC trade

  1. #21

  2. #22
    Quote Originally Posted by ;
    Yes both the FOMC and Congress have electricity, nevertheless in November a possible power change can and probably will happen in the good old boys' club, Congress. And when it's all said and done, those men (FOMC, federal political appointees, and members of Congress) dine in the very same restaurants, attend the identical dinner parties, play golf in the very same clubs, have exactly the very same connections, donate to the very same fundraisers....that's just political life.

    My analogy is right because those who have it (electricity ) never wish to lose itit is taken by a measure of force, sometimes in a civil, lively manner (politically), sometimes not so subtly (warfare ).

    Publications and class space eduion will rarely confirm or deny what happens in the hallways of power beyond the sterile relationships that supposedly exist as a result of separation of electricity or checks-and-balances. In different words to think some body that is nominated is really objective and unbiased is innocent. Do you truly feel the US Supreme Court is always an independent performer that they are justices for life?

    It's called you scratch my back and I'll scratch yours; it is called you owe me ; it is called payback. It's called politics. I call it bending and the wrist directing the invisible hand in the marketplace. So today in this election year , I turn to one of my weekend golf buddy, whose daughter attends school along with my son, whose wife goes shopping at Tyson's along with my spouse, who sits a couple of not-for-profit, charitable fondations together with me, I state to you and say I want your help, good buddy. And you say

    Bernanke don't abandon his mandate but there are exceptions to every rule. FOMC goes beyond Bernanke and I can't tell you that owes what to whom, or who controls whom. But this I know: most if not all the major political players in this town either owe a debt(s) or are seeking repayment, and they'll do whatever is necessary to keep their hold on power. And keep in mind, they all hail from different states, other cities so they are never really isolated from other FOMC members, bankers as well as the power players back home, in which the Republicans are tired of interest rate increases (be ye democrat or even republic is immaterial, a pause helps everone seeking re-election).

    We are not talking an or gate here; it is an and gate. Monetary policy affects politics daily yes AND moreso during election season. Consider it. Can the feds state with a straight-face there's no inflation, even though an increase in the so-called headline CPI? They do it by stating core CPI is still Here, that called pressuring FOMC to pause. Frankly, that core CPI was not a number that is true. Think. If you ask most Americans living outside the Beltway, if we're experiencing inflation, they will provide you a common sense answer

    And I never knew how the ADP numbers were so out of whack in July!! ADP was way off, but they were probably the true numbers (just out of step with the government's version of fact ). So what happened? The July NFP came out verifying no inflation.

    This month, August, ADP got the message and joined the party line because their numbers were consistent with the official August release, verifying no inflation.

    Just distinguish mirage in fact. And interest rates will rise again as our new Treasury secretary is on record as favoring a dollar. Only get November out of the way.
    All valid points, however I fail to see how an assessment regarding FOMC biases could be infered without understanding who is back warrants scratching. It might be the Bernanke or several the governors might be determined to the Democrats and policy action might be tailored to attract them to electricity. Without any evidence, I think it wise to stick to economic factors and leave the rest.

    Regarding ADP, NFP, and core CPI, it isn't necessary to attach shadow politics to the outcomes. I was forecasting a q3-q4 slowdown in November based on purely economic factors. With home price appreciation running well above historic averages and the equity extraction used to fuel the majority of GDP growth, any rookie economist might have surmised a slowdown was immanent. The latest data merely reflected the recession in consumers capacity to eat.

    The ADP figures, as reported by ADP, have a standard deviation of 91,000 (through Dec 05) in the reported BLS figures. In spite of all the July overlook, the report is still within the deviation for the year. ADP is a business that is massive, but it has a sample size then 1/5 that of their BLS NFP report and by ADP's own admission, the report is just marginally better then economist expectations. How often have those expectations missed by 200k or more?

    Finally, given your prestigeous credentials I'm awe struck by your comments concerning core CPI. There is not much doubt in my mind that Joe that a consensus to the existance of inflation could be discovered. Typical Joe barely understands how to maintain his checkbook balanced! How do you expect him to make a difference between tacky and variable prices? Should I derive from the comments that you would advoe extreme interest rates reductions to prevent deflation when (not if) oil drops to $40brl?

  3. #23
    FOMC choice wont really change considerably. Prior to entering trades wait. Becareful with gbp/usd.... Lots of people are positioned at the present time in it. Might be more susceptible to drawdown to wash places out before running back up.

    Usd/jpy seems resilient, almost as if a central bank is behind it, supporting it.

    This may force a short term dollar rally, profit taking in the recent movements.

    Chris

  4. #24
    1) USD bear spike over the first news

    2) Rest of the afternoon it fades the spike

    3) subsequent days the usd tendencies up

    4) project out weeks, the usd turns bearish.

  5. #25
    Hello!

    Because I visit the two MoneyMa$ter and Darkstar and others take a liking to fundamentals and history info and facts, I'd like to point out http://bigpicture.typepad.com/ is actually a superb site, at least imho.

    Additionally, it has comments and places on inflation, quotes from different places and the interesting excerpts of sources that are applicable.
    Oh, and of course it has a post regarding FOMC.

    I'd really like to hear your view on some of the posts and remarks there or only the overall information worth.
    As for the FOMC, I am not going to toss my 2 cents in, as I simply think we have already had the BOE surprise and NFP blowing cable through the roof and this one might turn out as bad as a ECB thing, actual figure doing nothing, then a very long winded address with heaps of hither and yonder drifting, nothing for me personally
    I prefer to wait until after to keep on trading a system onto it when everything is done and said
    I don't feel it's something to straddle like NFP. . .but We'll see how little or gigantic a move it ends up to be or become

    Props into Moneyma$ter (and many others such as sensibly, also of course) for participating actively on the forum and giving insightful remarks a lot of the time

  6. #26
    Why is it that many articles in a variety of forums think it will be a big today?
    About 90 percent are expecting the block and that will push the EUR/USD upward a bit.

    But why should it be more than only a bit.

    However should they alter the rate it will be a different game.
    If the improbable event of this rate going up the EUR/USD will sky dive.

    Perhaps one needs to only place a limit on brief the EUR/USD because the up move would be to little to straddle.

    Thoughts on this?

    thx

  7. #27
    1 Attachment(s)
    Quote Originally Posted by ;
    No I believe that the USD will move counter expectations....If that the feds increases rates, the USD will decrease if the Feds stored rates, the USD increases. . .It's not a matter of interest carry anymore, it is a matter of currency strength purchasing power in the first place today....Think about it, GBP interest today is 4.75%, EUR is 3 percent (And probably going higher) so on to different currencies, so I believe that the strength of the economies is going to be the major aspect to value a currency in the weeks to come....If you want to have an example, watch the USD/JPY, huge interest rate differential, nonetheless, it can't rally, on the flip side, it is revealing bearish signals every now then, because everyone on the planet knows that the Japanese economy is much stronger right now than the US economy....
    Thanks,
    Nader
    Nader,

    That's an interesting point that you brought up. As the move was said by you might be in the opposite direction of a reaction to rate hike.

    I slid into preceding market reactions to FOMC rate hikes and I found out it'd probably better to stay out of this trade - regardless of whether we face another rate hike or not. The reason of my opinion is that the FOMC announcement have led to a market previously. The market usually moves in both directions drastically. Here's a table that shows the cable motion (GBPUSD) throughout the last four FOMC announcements. Be aware that the price moves have been in PIPs and based on the chart published by my broker you may see different results in your own charts.

  8. #28
    It's horrible reading from the forum. I had an exact idea now, how to exchange and now I am doubtin myself. Ok here is the thing, whether it moves up or down, who cares?! Shouldn't we have a egy for the two directions? Any traders out there to answer this query? I am thinking to place two market orders for - state GBPUSD with stop loss, but I am wonderring not or if slippage will be got by baldness. . .when the market moves really fast.... Hope to hear reply...

  9. #29
    Hey Aparsai, where did you get this chart? That chart is VAULABLE for analyzing releases! Can you give me a link on the resources that you have the info? Because its you created the charts yourself, I want to create one.

  10. #30
    Quote Originally Posted by ;
    hey Aparsai, where did you get that chart? That chart is for studying releases VAULABLE! Can you give me a link on the sources which you have the info? Because its you created the charts yourself, I want to create one.
    All that info is in your broker's historical data..why would you believe this is difficult to discover?

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