Markets are going to be VOLATILE as hell next week

[swissaustrian]

Early on next week, a perfect storm for volatility is once again in the making

1. On sunday (6-17), Greece elects a new parliament. It's possible that the Communists (Syriza) win a majority and reject the bailout scheme. This would eventually lead to the GrExit. Markets would react with high volatility to this outcome on monday (6-18). But even if the pro-Baioult parties win, there'll be a spike in the Euro, once markets open on sunday evening (6 pm ET), probably dragging pms and stocks (futures) with it.

2. On monday and tuesday (6-18/19) G20 (shadow world economic government) "leaders" meet in Mexico. Depending on the outcome of the election in Greece and market reactions to it, they might announce some emergency measures (e.g. a new scheme involving non-European nations and the IMF, or capital controls of some kind). Regardless of the outcome in Greece they'll be discussing the rapid slowdown of the world economy and will probably publish some pathetic joint statement on their plans for growth. HFT algos will pick this up, creating volatility.

3. On tuesday and wednesday (6-19/20), the FED's FOMC meets. Many observers expect them to launch (or at least hint at) a new round of QE. Regardless of what happens, there'll be volatility on wednesday when they announce their decisions on 2:15 pm. If they don't do anything, markets will likely crash. pms will be espescially hit hard. If they announce a CTRL+P move pms should benefit the most. Tip: watch the front running in pms (and mining shares) BEFORE the announcement.

If you want to trade this information, you can either:

a) go long the VIX: http://www.ronpaulforums.com/showthread.php?361782-Time-to-go-long-the-VIX-(Volatility)

or

b) start a silver volatility trade with options: http://www.ronpaulforums.com/showthread.php?292691-How-to-trade-the-commodities-VOLATILITY

 

[jim49er]

What if Syriza won and markets fell sharply for a couple of days only to find out Bailout. lol
can kicking fun

 

[Zippyjuan]

Might be. But the anti- austerity crowd is already expected to win in Greece so most investors have probably already priced that in.

I would not expect much at the Fed meetings. They definately won't launch any new QE program- they have in the past always announced those at least a month before they start. They have been saying they are keeping an eye on things but I haven't heard anything strong enough to where I would expect them to change any actions this time around. I predict they will say they have some concerns about the economy but will keep policy exactly as it is- meaning Operation Twist (using proceeds from maturing short term Treasuries to buy new longer term ones) will continue and low interest rates will also continue and will "continue to keep their eyes on things".

 

[jim49er]

Sunday or Monday is not going to be d-day but why on earth would anyone keep their money in a safety deposit box?. The usd looks good for now anyway.

http://www.zerohedge.com/news/greek...-eerie-calm-takes-over-country-24-hours-d-day

 

[freedomordeath]

dont ever trust a communist, they talk all tough in the greek media but in english media they simply say they gonna renogiate the bailout agreement and stay in the Euro meaning Germany might allow better terms.. if this is the case then it will be up to the Germans weather they want Greece in or out. Don't trust a communist as far as you can throw them.

 

[oyarde]

Yes , I think they will be volatile , I also think they have been volatile...

 

[jclay2]

The fact that everyone is expecting huge volatility should be a sign that it won't be realized. Selling volume would be a better idea.
,

 

[swissaustrian]

EUR/USD spiked .8% so far as a reaction to the victory of the establishment/ pro-Euro parties in Greece, but pms didn't follow although they had spiked initially right after the opening bell. Smells a bit fishy. S&P500 futures opened higher and held their gains at .5%

 

[swissaustrian]

Aaaaand flash crash in gold... and only in gold, not even in silver

 

[QuickZ06]

Here we go.

 

[jim49er]

The market is going up a day or two.

 

[wgadget]

Flight to "safety" sinks 10 year US TREASURYS to a 1.55 yield.

 

[wgadget]

But you can get 7.1% if you're willing to invest in Spain for ten years....

 

[Lafayette]

A few headlines from ZeroHedge...

http://www.zerohedge.com/news/frontrunning-june-18


Greek radical leftist SYRIZA leader Tsipras says will not join coalition government (as expected)
Egypt Islamists claim presidency as army tightens grip (Reuters)
French Socialists vow reforms after big poll win (Reuters)
Greeks Back European Bailout (WSJ)
France, Socialists Win a Solid Majority (WSJ)
Denmark Warns over Pressure on Krone (FT)
Obama to press Putin on Syria at G20 amid skepticism (Reuters)... Putin to smile
China Home Prices Fall in Record No. of Cities (Bloomberg)
Europe Gets Emerging Market Crisis Ultimatum As G-20 Meet (Bloomberg)
Wolfgang Münchau – What Happens if Angela Merkel Does Get Her Way (FT)
Europe’s Mistakes A Lesson for Latin America, Chile Says (Bloomberg)
India Holds on Rates Amid Pressure to Cut (FT)
Samaras Begins Bid for Greek Coalition That Sustains Rescue (Bloomberg)

 

[Zippyjuan]

Today the Fed announced they will keep doing everything they are currently doing. http://enews.earthlink.net/article/top?guid=20120620/9e64176a-5855-40e8-a827-bd7d54738fd8 "Operation Twist" (taking revenues from maturing short term Treasuries and using that to buy longer term ones) was scheduled to end later this month but they extended it until the end of the year. This is the only "new" action though it simply also keeps things as they have been. I see this as an attempt to be viewed as doing something (to appease market fears if they had done nothing) while actually doing nothing. Like most of what they have tried so far, this (extending Twist) will have no real impact on the economy. There was fear that the stock market would take a big drop if the Fed said they would not do anything.

Lowering or keeping low interest rates to try to stimulate borrowing and spending only works if that demand is there and waiting. The economy is too slow for any demand for additional borrowing at this time. Companies are not looking to expand until they see more demand for their goods and services. The Fed cannot force them to do so.

 

[atomicsink]

I don't see a PM rise for a while, the value of precious metals is too subjective so as long as people still see value in the USD they will not flee to PM's. Think about it, is a Euro (fiat currency) holder more likely to flee to precious metals or to another fiat currency? The answer is obvious, they will flee to fiat currencies because that is what they do. Until the American debt crisis hits the media the USD will go up and PM's down when Euro tanks.

 

[swissaustrian]

I don't see a PM rise for a while, the value of precious metals is too subjective so as long as people still see value in the USD they will not flee to PM's. Think about it, is a Euro (fiat currency) holder more likely to flee to precious metals or to another fiat currency? The answer is obvious, they will flee to fiat currencies because that is what they do. Until the American debt crisis hits the media the USD will go up and PM's down when Euro tanks.

Gold is close to all time highs in Euros, so it's working as a hedge for Eurozone investors.

 

[Bossobass]

Today the Fed announced they will keep doing everything they are currently doing. http://enews.earthlink.net/article/top?guid=20120620/9e64176a-5855-40e8-a827-bd7d54738fd8 "Operation Twist" (taking revenues from maturing short term Treasuries and using that to buy longer term ones) was scheduled to end later this month but they extended it until the end of the year. This is the only "new" action though it simply also keeps things as they have been. I see this as an attempt to be viewed as doing something (to appease market fears if they had done nothing) while actually doing nothing. Like most of what they have tried so far, this (extending Twist) will have no real impact on the economy. There was fear that the stock market would take a big drop if the Fed said they would not do anything.

Lowering or keeping low interest rates to try to stimulate borrowing and spending only works if that demand is there and waiting. The economy is too slow for any demand for additional borrowing at this time. Companies are not looking to expand until they see more demand for their goods and services. The Fed cannot force them to do so.

Thanks for the media angle propaganda version of the US economy.

Where is this need to stimulate borrowing? FedGov is borrowing all available capital, and then some.

Entrepreneurs and small businesses in the US are so starved for capital it's a joke. There has never been a need to stimulate borrowing in America by entrepreneurs. What you mean to say is demand for further consumer debt to be used to buy more plastic and pot metal shit from Asia (including the new Cadillac, built in a Chinese plant, funded by taxpayer "capital").

"Stimulus" for "Infrastructure". Can you name one major infrastructure project funded by the trillions borrowed supposedly for this purpose? Let's see, there's the bridge project in Ca that went to the Chinese. The bulk went to weapons systems. The rest of the pittance of what was left went to filling pot holes.

A hand-selected few banks and defense contractors got it all. The rest of the US economy got directions to the bankruptcy window. Small businesses and start-ups (where 80% of patents and innovations come from) aren't "hoarding cash", they're burning cash to survive. Anyone who buys that the Fed doesn't know this full well ("we have to gather more information about where the US and Euro economies are headed") is a pitiable dolt.

"The market" is always sifting through FOMC statements for a sign, yet Bennie said: "[The Fed] stands ready to do whatever is necessary to protect our financial system", and, “The Federal Reserve remains prepared to take action as needed to protect the U.S. economy in the event that financial stresses escalate”.

I guess that's not obvious enough. Wall Street Banks and FedGov will get the cash. The US economy will get nothing.

"Stimulate borrowing"... man, that's a good one.

 

[StilesBC]

VIX is down 12% on the week.

Moral of the story? Don't trade based on "news".

 

[atomicsink]

Gold is close to all time highs in Euros, so it's working as a hedge for Eurozone investors.

That's cause the Euro sucks. PM's AND the dollar AND a lot of other currencies have been gaining vs the Euro. Until PM's gain vs the average currency (which they were doing last decade) they aren't really gaining. PM's have gained a lot over the past decade, but recently they had been getting 'corrected' and it will be a while before we see a real rise.