Posts Tagged: futures contract

 

In a surprise move given all the recent congratulatory bullshit from Abe and Kuroda on breaking the back of Japan’s deflation and bring about recovery (forgetting to mention record high misery index, surging bankruptcies and a crushed consumer), the Bank of Japan (by a 5-4 vote) raised its bond-buying program from JPY 70 trillion to 80 trillion… and increases its ETF buying to JPY 3 trillion. This move, on the heels of more confirmation of broader foreign asset purchases in Japan’s GPIF sent USDJPY instantly gapping 1 big figure higher to 110.30 and Nikkei futures instantly rose 400 points. S&P futures are also surging. Gold and silver are tanking and TSY bonds are selling off.

  • *BOJ UNEXPECTEDLY TARGETS BIGGER EXPANSION OF MONETARY BASE
  • *BOJ TARGETS 80T YEN ANNUAL EXPANSION IN MONETARY BASE
  • *BOJ SEES RISKS IN CHANGING DEFLATIONARY MINDSET
  • *BOJ AIMS FOR ANNUAL INCREASE OF 80T YEN IN JGB HOLDINGS
  • *BOJ EXPANDS PURCHASES OF ETFS TO 3T YEN

BoJ Statement >> Read More

 

 BP Plc today wrote down the value of its $7.2-billion investment in India’s oil and gas fields made in February 2011 by a little over 10 per cent.

Unveiling its third-quarter results on Tuesday, BP said it had written down the value of its investment in KG-D6 — the deep-water field operated by Reliance Industries in Krishna Godavari basin — by $770 million.

The oil behemoth attributed the charge to the “uncertainty in the future long-term gas price outlook following the introduction of a new formula for Indian gas prices”.

On October 18, the Narendra Modi-government approved a new formula that capped the gas price from deep-water fields at $5.61 per million British thermal unit (mBtu).

The new gas price will come into effect from November 1 but it won’t apply to Reliance Industries, which has filed for arbitration in a dispute with the government over the admissibility of certain cost recoveries on account of the huge shortfall in gas production from KG-D6 gas field. >> Read More

 
  • Prior 264k. Revised to 266k
  • Continued claims 2.351m vs 2.380m exp. Prior 2.389m
  • 4 week average 281k vs 283.5k. Revised to 284k

You just can’t find bad news in this weekly report.

USD/JPY is taking off again to resistance at 107.70/75 and we’ve got a very positive dollar environment with decent stock earnings being reflected in bond yields rising and stock futures pointing to a good cash opening.

A steady fall in the US unemployment rate has proved a bright spot in a six-year recovery that, as far as the wider performance of the US economy is concerned, has been uneven.

The total number of people still receiving jobless benefits in the US was 2.35m. It peaked at 6.6m in May 2009.

US initial jobless claims 23 10 2014

 

Nelson Bunker Hunt, who has died at the age of 88, was everything a Texan oil tycoon was supposed to be. Once one of the richest men in the world, he made and lost fortunes in crude, commodities, thoroughbred race horses, pizza parlours and commercial development. But he will be remembered most for trying to corner the global market in silver, an endeavour that went down in flames, eventually sending him into bankruptcy, when the bubble in the market for the metal burst in 1980.

He was the second son of HL Hunt, the prototypical wildcatter, who fathered 14 children in three families who did not know of the existence of the others.

Born on February 22 1926, in El Dorado, Texas, Bunker Hunt was by contrast monogamous, with three daughters and a son by his wife Caroline, all of whom survive him. He was very religious and a fervent anticommunist, a supporter of the likes of the John Birch Society.

He also lived modestly, a non-smoking teetotaller who drove old Cadillacs, flew economy class and preferred barbecue shacks to plush Dallas oil clubs.

Having dropped out of the University of Texas, he joined his father’s company but quit to strike out on his own in Pakistan and the Middle East. Dry wells forced him to sell half his interest in the Sarir oilfields in Libya in 1960 to BP, but a year later the partners struck oil and the money flowed. >> Read More

Trading Psychology Quotes

21 October 2014 - 11:41 am
 

Anyone who claims to be intrigued by the “intellectual challenge of the markets” is not a trader. The markets are as intellectually challenging as a fistfight. Ultimately, trading is an exercise in self-mastery and endurance.

The key to trading success is emotional discipline. If intelligence were the key, there would be a lot more people making money trading.

Just remember, without discipline, a clear strategy, and a concise plan, the speculator will fall into all the emotional pitfalls of the market – jump from one stock to another, hold a losing position too long, and cut out of a winner too soon, for no reason other than fear of losing profit. Greed, Fear, Impatience, Ignorance, and Hope will all fight for mental dominance over the speculator. Then, after a few failures and catastrophes the speculator may become demoralised, depressed, despondent, and abandon the market and the chance to make a fortune from what the market has to offer. >> Read More

 
  1. Trading too big to “get back to even”.

  2. Going “all in” on one trade that they believe they just can’t lose.

  3. Being on the wrong side of an asymmetric trade.  Being short options for possible small gains if right but big losses if wrong.  In the long term eventually this blows up.

  4. Fighting a trend over and over again, a trend that a trader or investor can not even believe is very dangerous because shorts look better the higher a stock goes and longs look like they are getting a bargain the lower the stock sinks.

  5. In a losing trade the trader starts thinking “add more to a losing position” instead of “I need to cut my loss short”.

  6. The trader believes they are right and the market is wrong.

  7. Traders are trading markets they do not even fully understand and a trader must fully understand the risk and leverage involved  in currencies, futures, options, and commodities to prevent possible blow ups due from ignorance.

If a trader can tightly control risk and position sizes this will get them closer to getting in the club with the 10% of winning traders.

 

Highlights of the initial jobless claims report for the week ending Oct 11:

  • Prior reading was 287K

Claims are at a post-crisis low.

initial jobless claims

The data is giving the US dollar a bump and has slightly pared losses in stock futures.

 

Q1FY15 deal signings of $32m, the highest since Q4FY11, has raised hopes amongst investors of OFSS having turned a corner. Our analysis though suggests otherwise. Even in a best case scenario,new license signings of $80m in FY15 would only lead to 15% growth for the products business. Given that we are moving into the seasonally weak quarters, the best case scenario is unlikely to play out in our view. With the special dividend surprise, investors are now likely to keep a tab on cash accretion (to anticipate future special dividends), making OFSS an event driven play. Currently trading at 22x FY16 EPS, OFSS is an expensive way to play the

global products space. We raise our FY15 revenue and EPS estimates by 7% and 4% and reiterate SELL on OFSS with a new FV of Rs2,750 (up from Rs2,600).Nothing has changed fundamentally to alter our view

OFSS has underperformed the BSE-IT index by c.1% YTD including special dividend. While Q1FY15 license signing of $32m was strong and the highest since Q4FY11, can we extrapolate these numbers to conclude higher growth is in the offing in FY15 and FY16? We don’t think so. >> Read More

Traders Must Follow These Rules

11 October 2014 - 11:29 am
 

More important than any entry system….Money management and trading psychology are much important

Keep Losses Small…

Trade with stops

Trade in the direction of the trend

Doubling down is a sure way to lose money and blow up

Trade with a complete plan knowing exactly what to buy/sell…how much to buy/sell and know exactly when the trade does not work… >> Read More

10 Trading Mistakes

10 October 2014 - 11:44 am
 
  1. Are you trading without a plan? Trading without a plan makes you emotional and a gambler.
  2. Do you ever trade too big for your trading account size? Big trades are bad trades for the emotional engagement and risk of ruin that they entail over the long term.
  3. Do you risk losing more if you are wrong than you will make if you are right? The biggest driver of profitability in your trading will be big wins and small losses. Big losses and small wins is a sure path to losing your trading capital.
  4. Have you traded without studying charts to see what has happened historically with similiar price patterns? If you do your homework you can make money understanding possibilities and probabilities from past patterns. Trading your own opinions will usually put you on the wrong side of the market. 
  5. Did you trade a system before you back-tested it?Or are you just trading blindly?
  6. Have you ever exited a trade due to fear instead of due to hitting your stop loss or trailing stop? The right exit is what determines your profitability and whether your win is a big one or your loss is a big one.
  7. Have you ever entered a trade becasue of greed without an entry signal? Chasing a trade after the trend is over is a great way to lose money consistently and quickly.
  8. Have you ever copied someone else’s trade not knowing their time frame or position size? Ultimately you have to trade your own system and your own method that matches your own personality and risk tolerance. Only you can make yourself profitable with faith in yourself and your method.
  9. Are you that person that loves to short during market up trends and miss a whole up move?The easy money is on the side of the trend in your time frame going against the trend is a great way to lose money.
  10. Are you that knife catcher that keeps going long at the worn time in a down trend? When everyone is exiting a market that is the worst time to be getting long as wave after wave of holders are leaving. 

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Technically Yours,
Team ASR,
Baroda, India.