AI
Tuesday, September 10, 2002 3:55:08 PM
My market WAG regarding the next few days
Background:
1. Tuesday, (today) -- terrorist threat alert raised to orange, which is second highest level.
2. Tomorrow = 911
3. Thursday, President speaks to UN about invading Iraq.
Analysis:
Today is the first time since institution of the color coding terror-warning system that it has gone this high. The markets responded with a quick sell off, but then rebounded very quickly with rather suspicious looking spikes up at 11:30 pacific time. Markets are now weakening again at 12:23 pacific.
So, what happens tomorrow?
Regardless of what else happens, I expect a fairly sideways to down day tomorrow. Markets open late, after nation-wide memorial services. So, I'm thinking that the markets may well start strong as a wave of patriotism gooses things a bit. But, as the day drags on, I think we'll see slippage.
What about the terrorist threat/reality?
I see three or four possibilities:
1. Nothing happens at all. (~30% chance, IMHO)
2. Something or things happen, but they are small enough to be taken in stride. (~60% chance, IMHO)
3. Something big happens. (~10% chance, IMHO)
3(a) or 4. Something REALLY big happens. (~1% chance, IMHO)
Possible effects on Thursday's trading under each scenario:
1. Rally most of the day.
2. Start weak, then rally most of the day.
3. Tank like a mugger-flugger, assuming the markets open.
Okay, so, where does the President's speech to the UN fit in?
I think that regardless of what happens on 911, the speech is going to spook the markets. The question is, by how much? I think the answer to this question depends in large part on whether we are under scenario 1, 2, or 3.
If no terrorist attacks occur on 911, then I think the markets will be spooked a bit, but not excessively. After all, Da Boyz will want to make sure things don't drop so low they can't bring them back up for options expiry.
If an attack or attacks occur on 911, then the speech will have to be rewritten, at least in parts, at the last minute, and the President will be more likely to show strong feelings while delivering it. Thus, the effect of any attacks on the speech, and thus on the markets, depends, IMHO, upon how pissed off the Pres is about the particular attacks.
A few small attacks which kill a few people, (especially if the occur outside the U.S.), will probably leave the Pres feeling angry and disgusted, but still able to speak in normal tones -- less than perfectly articulate though those may be.
At the other end of the spectrum... If, say, a baseball stadium full of people were to go up in smoke tomorrow, then I really wouldn't want to be a UN delegate from a Middle Eastern country. Nor would I want to be long anything except gold.
Anyhow, that's my thumbnail view.
Right now things are just too uncertain, IMHO, to hold ANYTHING overnight.
(:
Most recent Charts @ MDA Thread #board-1320
My Trading Stuff #board-1220
PPT Archive #board-1280
Charting Experiments #board-1263
Background:
1. Tuesday, (today) -- terrorist threat alert raised to orange, which is second highest level.
2. Tomorrow = 911
3. Thursday, President speaks to UN about invading Iraq.
Analysis:
Today is the first time since institution of the color coding terror-warning system that it has gone this high. The markets responded with a quick sell off, but then rebounded very quickly with rather suspicious looking spikes up at 11:30 pacific time. Markets are now weakening again at 12:23 pacific.
So, what happens tomorrow?
Regardless of what else happens, I expect a fairly sideways to down day tomorrow. Markets open late, after nation-wide memorial services. So, I'm thinking that the markets may well start strong as a wave of patriotism gooses things a bit. But, as the day drags on, I think we'll see slippage.
What about the terrorist threat/reality?
I see three or four possibilities:
1. Nothing happens at all. (~30% chance, IMHO)
2. Something or things happen, but they are small enough to be taken in stride. (~60% chance, IMHO)
3. Something big happens. (~10% chance, IMHO)
3(a) or 4. Something REALLY big happens. (~1% chance, IMHO)
Possible effects on Thursday's trading under each scenario:
1. Rally most of the day.
2. Start weak, then rally most of the day.
3. Tank like a mugger-flugger, assuming the markets open.
Okay, so, where does the President's speech to the UN fit in?
I think that regardless of what happens on 911, the speech is going to spook the markets. The question is, by how much? I think the answer to this question depends in large part on whether we are under scenario 1, 2, or 3.
If no terrorist attacks occur on 911, then I think the markets will be spooked a bit, but not excessively. After all, Da Boyz will want to make sure things don't drop so low they can't bring them back up for options expiry.
If an attack or attacks occur on 911, then the speech will have to be rewritten, at least in parts, at the last minute, and the President will be more likely to show strong feelings while delivering it. Thus, the effect of any attacks on the speech, and thus on the markets, depends, IMHO, upon how pissed off the Pres is about the particular attacks.
A few small attacks which kill a few people, (especially if the occur outside the U.S.), will probably leave the Pres feeling angry and disgusted, but still able to speak in normal tones -- less than perfectly articulate though those may be.
At the other end of the spectrum... If, say, a baseball stadium full of people were to go up in smoke tomorrow, then I really wouldn't want to be a UN delegate from a Middle Eastern country. Nor would I want to be long anything except gold.
Anyhow, that's my thumbnail view.
Right now things are just too uncertain, IMHO, to hold ANYTHING overnight.
(:
Most recent Charts @ MDA Thread #board-1320
My Trading Stuff #board-1220
PPT Archive #board-1280
Charting Experiments #board-1263
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