Thursday, 13 September 2012

FOMC meeting at 2.15am Singapore Time

Dear Friends,

Tonight we have another big night and expect the market to be volatile. For me, all bullish positions are closed going into the meeting except Apple. You can see that the market may be quiet going into this meeting. In fact now, Singapore STI is down 10 points. Do not expect a run-up today.

There may be a few things to note and how I would probably strategise my trades. Do take it as a reference for you.

1) Silver ETF (SLV) and Gold ETF (GLD) - If the market is bullish about what Ben says, probably the run-up will continue, and if it is disappointed, you can expect a bit of setback in the price. But it would probably be choppy in the first 10 minutes of trade. Try to see if there is a continuation of direction before entry.

2) If there is a positive QE package, financial sector like Bank of America BAC and JP Morgan JPM are good companies to bet on. If you have notice, last week Europe bonds buyout cause Europe banking stocks to surge as banks are always the direct beneficiaries of QE.

3) If there is a disappointment, I would wait the market to correct, then wait for Dow Jones to show me a bit of confidence before entering to accumulate my stocks for the mid term. A good sign if Dow really drops today would be a triple digit increase.

I am not attempting to guess how the outcome will be. The market reaction to Ben's speech should tell you how it is.



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