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Strategies & Market Trends : The Amateur Traders Corner

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To: Tom Hua who wrote (6492)	2/25/2001 7:37:38 PM
From: GregS	Read Replies (2) of 19633

Tom, If the fed does cut, and if the NAZ does rally, the contrary side of me wonders if the ensuing sell-off should be bought? My reasoning is simple, the last two rates cuts sold off hard in the days following the cuts, I think many traders will by now have learned their lesson, and will go short after some kind of run-up. The could set up for another nice squeeze that may produce a more sustainable rally that goes much higher than most expected. Based on the VIX ratio, I think Friday's rebound was driven largely by short covering, I'm starting to think the right trade on any rate cut would be to sell longs into the announcement, hope for a sell-off, and buy that sell-off for a pretty nice squeeze. Just a thought at this point, I still kind of doubt we get the intra meeting cut in the first place, but I am long nonetheless. Your thoughts would be appreciated.

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