THE TIME & THE PLACE?

Full of bearish intent ..... 

I've chopped about the last month with negligible PNL and strong opinions VERY weakly held as the markets waited upon some 'European cartharsis.'.''

Today - post 'THE solutions' - my MICRO and MACRO patterns converged: 

SPX  - 1265 

EURUSD - 1.40+

AUDUSD - 1.05+

DAX - 6200

Markets have/are certainly testing the boundries of my margin of error ....

But you gotta do what you gotta do.

Mixed execution during the day ......

But full trade (=2% Equity Risk) on at/above MY levels.

Approaching the close looking to stay alive through the weekend.

Thinking one of the innumerable moving parts in the still unfolding European melodrama might still wipe the smile from what must be an extremely self-satisfied Frenchman.

Merkel's Mandate - Revisited

Originally written on the 29th September - more relevant then ever?


The Bundestag is about to pass the EFSF legislation with a thumping majority but be very careful how you interpret this vote.

Rather than endorsing the urgency for a more expansive solution to the rolling EuroZone 'debt crisis'  ..... this legislation has passed on solely Germanic concerns.

Two contributions (both sourced from the FT) warn of the (unintended?) second order consequences of this vote.

First - Schaeble (Finanace minister): 'insisted the EFSF would not be secretly boosted by financial leverage ...... it will not be increased ..... that is not under discussion.'

Second - and arguably more profound for the future of the Euro - Norbert Barthle (CDU Budget Spokesman):  'the new law - with its commitment to give the German parliament a vote on all future changes in the EuroZone crisis measures - mean a totally new form of Democratic legitimacy for the EU legislation in Germany.'

If I was the most rabid Germany Euro-sceptic ..... I would have voted for this.

German (democratic) populism will now decide. And that's a good thing - right?

Third order consequences to follow.

The Price is THE News

As we pop higher once again I reminded that very rarely has this familiar trading expression been so true.

This week's 'news/rumor' flow surrounding the EuroZone crisis has been almost farcical.

Every 'wishful' political utterance has been validated, every hard fact ignored, and markets continue to chop at & just below their 'recovery' highs on the belief some Tarp-like 'bazooka' can be found.

In my opinion - whatever is finally cobbled together won't be enough to satisfy the markets 'thank god that's all sorted out' desire. I don't know how it plays out, but in my opinion this is a long way from over.

I believe the art of trading is too manage your risk, respect ongoing price discovery, and take your positions where the potential reward justifies the actual risk.

With humility - all my set-ups look bearish.

Testing