Friday, September 14, 2012

Not so easy to read this morning

Lets try to explain yesterdays price action combined with the price action this morning.  The initial down trade was a long liquidation (7's had richened on the curve going into i understand unwinding that position).  There was probably some momentum selling from those who were disappointed that QE3 didn't involve additional treasury purchases, but that should be inconsequential in the whole of things.  Once the long liquidation was complete, there was a vacuum, filled by buyers, buying the bottom of the bell curve, and no marginal sellers.  Taking the market back to the top of the bell curve..also understandable as all the long liquidation had been completed, and there were no more sellers.  The downtrade this morning means that the buying at the bottom of the bell curve yesterday did NOT create an under-supply condition.  This would mean that the market is random now, seeking out a new center of value.  Its still unclear what yesterdays bottom buyers plan to do.  Stay tuned for that.

I'm still flat...just waiting for more clarity.

1 comment:

  1. >> Its still unclear what yesterdays bottom buyers plan to do
    If 132 is taken, their plan is to panic :)
    (But probably it won't happen today)