Wednesday, December 13, 2006


And I gingerly stepped back into the market... So far, just one NQ Mar 07 contract @ 1805.50. If an uptrend takes hold I may add to it. Though it was announced this morning that the US trade deficit narrowed significantly the USD is weak (AUD = 0.7864). Bonds are up slightly and stocks are down. I am a bit apprehensive of getting too bold before the FOMC announcement at 2:15pm. Bernanke is in China, so don't expect any surprises. The most significant thing that could happen I am thinking is if Jeffrey Lacker doesn't dissent from the decision and state that he thinks interest rates should be raised as he has at recent meetings. That could be bullish for stocks (or maybe not - my TA is pointing up in the stockmarket so I suspect it would be read bullishly - rather than a sign that the economy is even weaker). It would certainly be bullish for bonds and bad for the USD.


It's been a catching falling knives kind of day. The model was forecasting a slightly down day (after the level I mentioned yesterday didn't hold). So when the market opened down I thought that was a good time to buy. The market fell much more before the FOMC announcement though... Lacker dissented again. Apparently he is rotating off the FOMC after this meeting. At least the model is forecasting an uptrend now for the near future as I'm underwater on the two contracts I ended up buying (there was a third which I sold for a small gain). Bonds are up and the USD down after the announcement while stocks are up though very volatile.

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