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  • #70,721
  • Nov 15, 2013 10:20am Nov 15, 2013 10:20am
If Fed Lowers Unemployment Threshold, Key Question Will Be Why?

http://blogs.wsj.com/economics/2013/...n-will-be-why/
The world you desire can be won. It exists.. it is real.. it is possible..
  • #70,722
  • Nov 15, 2013 10:20am Nov 15, 2013 10:20am
Quoting neuron
thx PT, there's definitely some resistance here. trying to see if we're gonna retest the rising trendline. in retrospect not the best thought out trade lol {image}
That trend line will very likely be tested, but I think it need to base out to find buyers.
Hard to buy right at resistance, and now it's a bit late in the day.

It may even manifest itself via a weekend retail gap.

Regardless, we may have already topped. Trend lines are not always retested to the pip. In fact, multiple failures to reach is often a confirmation that a top/bottom is in.
Those who say it cannot be done should not interrupt those who are doing it
  • #70,723
  • Nov 15, 2013 10:23am Nov 15, 2013 10:23am
Quoting Mr. Scott
{quote} I prefer this: {image}
Ha Ha. Good one
Those who say it cannot be done should not interrupt those who are doing it
  • #70,724
  • Nov 15, 2013 10:36am Nov 15, 2013 10:36am
G.. weekend .
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  • #70,725
  • Nov 15, 2013 10:41am Nov 15, 2013 10:41am
Quoting Mr. Scott
If Fed Lowers Unemployment Threshold, Key Question Will Be Why? http://blogs.wsj.com/economics/2013/...n-will-be-why/
I think the markets are already confused about the Fed's intentions. It was very clear when the treasury yields rallied on a hint that the taper may start by the end of 2013 even though it was made abundantly clear that rates would not rise until UE was at or below 6.5%. So what difference would it make if they said 6.0% instead?
Those who say it cannot be done should not interrupt those who are doing it
  • #70,726
  • Nov 15, 2013 10:44am Nov 15, 2013 10:44am
Quoting chess king
G.. weekend .{image}
Ha Ha

Good weekend to you also.
Those who say it cannot be done should not interrupt those who are doing it
  • #70,727
  • Nov 15, 2013 10:51am Nov 15, 2013 10:51am
Quoting PipTrapper
{quote} That trend line will very likely be tested, but I think it need to base out to find buyers. Hard to buy right at resistance, and now it's a bit late in the day. It may even manifest itself via a weekend retail gap. Regardless, we may have already topped. Trend lines are not always retested to the pip. In fact, multiple failures to reach is often a confirmation that a top/bottom is in.
thanks for explaining your reasoning i've hopped out of the trade, market gave me just enough of a lift to run with a couple pips. don't like having open positions over weekend anyways.
  • #70,728
  • Nov 15, 2013 10:57am Nov 15, 2013 10:57am
Quoting PipTrapper
{quote} I think the markets are already confused about the Fed's intentions. It was very clear when the treasury yields rallied on a hint that the taper may start by the end of 2013 even though it was made abundantly clear that rates would not rise until UE was at or below 6.5%. So what difference would it make if they said 6.0% instead?

Well, labor force participation is lowest in 30 years.

http://research.stlouisfed.org/fred2...onthly&fam=avg

One would expect it to pick up when labor market picks up so that would actually increase the unemployment rate. Bringing UE down to 6% would imply 0% rates for much further into the future than the market currently expects.

Last spike was due to fed funds spike due to factoring of earlier than expected increase in short term rates not taper.

http://s.wsj.net/public/resources/im...1114095215.jpg


Now, we would expect the opposite unless and until the bond market starts to discount in stronger than expect labor market or inflation.
The world you desire can be won. It exists.. it is real.. it is possible..
  • #70,729
  • Nov 15, 2013 11:31am Nov 15, 2013 11:31am
Quoting Mr. Scott
{quote} Last spike was due to fed funds spike due to factoring of earlier than expected increase in short term rates not taper. {image} Now, we would expect the opposite unless and until the bond market starts to discount in stronger than expect labor market or inflation.
And why was there an expectation of an earlier increase?
Was it not because the markets thought that a taper would bring about an earlier rate increase?
Those who say it cannot be done should not interrupt those who are doing it
  • #70,730
  • Nov 15, 2013 11:35am Nov 15, 2013 11:35am
Quoting PipTrapper
{quote} And why was there an expectation of an earlier increase? Was it not because the markets thought that a taper would signal an earlier rate increase?
Yes, exactly PT. Market freaked out that Fed was more hawkish than previously indicated and no one wants to be the last one out the door. I did not buy it at the time based on data, but that is what market did.

Now, Fed is signaling although they would like to taper it is still data dependent and in addition, they are not only willing to keep rates at 0 but keep them at zero for longer than previously expected.
The world you desire can be won. It exists.. it is real.. it is possible..
  • #70,731
  • Nov 15, 2013 12:06pm Nov 15, 2013 12:06pm
Quoting Mr. Scott
{quote} Yes, exactly PT. Market freaked out that Fed was more hawkish than previously indicated and no one wants to be the last one out the door. I did not buy it at the time based on data, but that is what market did. Now, Fed is signaling although they would like to taper it is still data dependent and in addition, they are not only willing to keep rates at 0 but keep them at zero for longer than previously expected.
Okay so here's my take and why I feel taper is going to raise real rates immediately.

The Fed and recently Yellen in her confirmation hearing have been harping on data dependency.
Therefore the signal is that if taper starts it means that economy is able to float on its own without the heroin drip.
At that point you get the same effect... Nobody wants to be the last one out the door.

So no matter what they say about rates tied to a lower UE than originally stated, there will still be a rush for the exits.
Those who say it cannot be done should not interrupt those who are doing it
  • #70,732
  • Nov 15, 2013 12:13pm Nov 15, 2013 12:13pm
Quoting PipTrapper
{quote} Okay so here's my take and why I feel taper is going to raise real rates immediately. The Fed and recently Yellen in her confirmation hearing have been harping on data dependency. Therefore the signal is that if taper starts it means that economy is able to float on its own without the heroin drip. At that point you get the same effect... Nobody wants to be the last one out the door. So no matter what they say about rates tied to a lower UE than originally stated, there will still be a rush for the exits.
Nice analysis PT. I wish you a good weekend.
The world you desire can be won. It exists.. it is real.. it is possible..
  • #70,733
  • Nov 15, 2013 12:33pm Nov 15, 2013 12:33pm
Wish a good weekend for all of you mates
  • #70,734
  • Nov 15, 2013 12:42pm Nov 15, 2013 12:42pm
Good weekend to all.

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Those who say it cannot be done should not interrupt those who are doing it
  • #70,735
  • Nov 15, 2013 12:47pm Nov 15, 2013 12:47pm
have a great weekend all!
  • #70,736
  • Nov 15, 2013 1:03pm Nov 15, 2013 1:03pm
I wish you all a wonderful weekend and thanks again, PT, for "reanimating" this thread!
  • #70,737
  • Nov 15, 2013 2:54pm Nov 15, 2013 2:54pm
D .. chart.
my map..
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  • #70,738
  • Nov 16, 2013 1:06pm Nov 16, 2013 1:06pm
Thanks for the link Tom
Quoting Tom_D_Trader
{quote} Greater fool theory, old stuff. It was Sir Isaac Newton in 18th century, trading South Sea Bubble who made this phenomenon known to investing community. http://www.telegraph.co.uk/culture/4...ol-theory.html
http://www.telegraph.co.uk/culture/4...ol-theory.html
Those who say it cannot be done should not interrupt those who are doing it
  • #70,739
  • Nov 16, 2013 1:17pm Nov 16, 2013 1:17pm
Quoting PipTrapper
Thanks for the link Tom
Am stalking your thread mate , just dont have enough time to write proper analysis, as you may have seen am currently enjoying drawdown, so got lots of work and not much time to spare. But will join you soon.
Take care,
T
"I know one thing, that I know nothing." Sokrates
  • #70,740
  • Nov 17, 2013 8:53am Nov 17, 2013 8:53am
Quoting Likerty
{quote} Bastards retreating now just to break weekly highs next week up for 3520 to turn back for 3240's later...
Lets see if they will play by the book...
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