Tuesday, June 28, 2011
Sniffing Out the News
The market is speaking today about what will happen with the Greece austerity vote tomorrow. Crude oil is higher, gold isn't rallying with the other commodities, and dollar is weaker across the board with higher stocks. The market expects the Greece austerity vote to pass. The Athens stock index is speaking loudly, rallying strongly today. But there are two votes, the austerity vote, and the implementation vote. So the 2nd vote might not pass, but it probably won't matter at that point (except for some short term market volatility) because the Europeans will say one vote passage is enough and will willingly give the money to avoid possible contagion.
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4 comments:
going back to your mirror analog, the trade was frontrun bid ahead of the last vote. perhaps we sell into the uncertainty this here and then buy the news.
Market looks VERY strong. I don't think we get much of a selloff we get from here until the vote. If we do, it would be a great buying opportunity. I agree, after the news comes out we go higher.
I'm rather bullishly positioned and from a long-term perspective I really hope they vote it down. Then finally the EU might get a clue and start supporting the banks (money has to end up somewhere so might as well right..) instead of the deadbeat Greeks who will certainly not repay their debt.
I think the market is saying it won't give a damn whether it passes or not. Even if it doesn't, it'll probably mean a retest of the bottom (again) and then it can rip higher worry-free of the Greeks.
Also just because the market is "expecting" the vote to pass doesn't mean it will necessarily go down if it doesn't or up if it does.
Ok they'll get this Greek thing out of the way (which was just smokescreen) and then back to reality of a weakening economy. I'm convinced fed follows seasonality patterns on the S&P.
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