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Politics : Idea Of The Day -- Ignore unavailable to you. Want to Upgrade?

To: J.T. who wrote (20740)	10/3/1998 10:34:00 AM
From: BubbaFred	Read Replies (2) \| Respond to of 50167

J.T. - I think you are going to hit it on the nose. Too many ominous signs right now. Message 5896444 Message 5903274 Message 5903520

To: J.T. who wrote (20740)	10/5/1998 3:45:00 AM
From: IQBAL LATIF	Read Replies (3) \| Respond to of 50167

I think last Friday when I wrote my post globex was much lower around 986 level-- we did check some lower supports but ended up higher to close at 1012. I am not sure about this prevelant sentiment of a major disaster, for me it needs to take out the 1000 mark on two closing basis, I flip the coin and say why is SPZ sitting at 1002 even when Nikkei has taken out 13000, may be like 14000 it will be another support broken but don't forget that adequacy ratio of Japanese banks have been helped by this huge bond rally- Japanese are sitting on huge profits-and therefore this break below 13000 may not be that serious if it would have come with bond yields at 5.65 level. I think a close below 1000 today would warrant puts 920 for Nov contract-- I will reiterate that I have already established a spread 920- 950 but \I will certainly like to agressively increase my number of positions with long Nov puts and short 850's, I will like to leg out of it at 950-960 area if 1000 is broken on two consecutive basis I will see that however I will not like to spend straight money on a put where premiums may just get eroded if this market moves above 1030-- 1992 lower $ resulted in one of the finest bull runs from 1993 to 1998 I would think that we have an outside chance to see a 60% retracement of 600 to 1200 run we have already seen 50% but in my opinion I am really surprised to see this bond rallying in wake of underlying strength of the economy= I just see that their is a close co-realtion in Nikei futures post Baring (Nick Leeson episode) and bond futures,bond futures are building in huge deflation and we will see two shocks soon one economic numbers will depict no such slow down and other earniongs have been discounted huge I would think we will see much better than expected lowered eqarnings. Look at ALA trading at 18 this stock back in 1995 I saw it at 18 when France was in ther grip of worst recession, I don't see that in France now, the growth has increased from .5% TO 2.1% so for me stock market presents a picture of big squeeze ala Nick Leeson. It is a well known secret that thousands of complex derivatives of LTC remain so far unwound, these smart guys were short in TB's now with this bail out package it is well known that Fed is serious in getting these position sorted out in an orderly manner, now when traders like us smell blood they would bid the price of the bond to levels where htey get the maximum profit like they did in case of Nikkei futures when baring went bust, I think that present bond yields are a result of this squeeze--I don't think that market will let LTC unwind its short TB and short bund poisitions easily...this is also leading to pressure on Nikkei futures, the long bond holders know it well that as Nekkei drops the global market sensing deflation would mark up bond prices- I should think that this is a critical week and therefore I had tied 690 BKX level with any move up, I would keenly watch BKX and would like this not to take out 645 area, we will see some very high degree of voltality due to facts I have highlighted above, the best strategy would be to look at key supports and short the market with a generous put spread, we have 12 days during which these things need to be sorted out, the traders who are behind this squeeze know it well that if earnings start coming better than expectations we can see bond rallying upto 5.25% in know time-- so for what it is worth we have a war of wits- the one who will hold out will win-- in my opinion the banks will not liquidate now they will wait for the earning seasons and strong economic numbers-- the traders will keep shorting the stock markets like Nikkei futures and DAX but around the corner some shorts wil be caught up very badly- it is for this I am in the game with an outside strategy 850 short puts and 920 950 long puts Nov contracts 1 long put 1.5 short put- I will recommend this strategy only when 1000 is taken out...