S&P 500 and Dow Jones - Mar Expectation

[Larry1234 10]

Hello everyone,

 

I have started this thread to talk about regarding the markets (basically S&P 500 and Dow Jones Index) movements in the month of March. What do you think where will it move northwards or southwards ?

 

In my opinion, since U.S. stock futures are higher and pushing the S&P 500 up to make a fresh challenge on its all-time highest close and for the Dow Jones to continue its record run. I see the market to move in northwards in march.

 

Do you ???

[ntrader 10]

After hitting new highs DOW and S&P i believe there is about time for correction and profit taking, and the situation in Europe is a good reason for that after the Cyoprus bailout. I have a price target for S&P at 1505 for the expected March corection.

[Larry1234 10]

Its only 1 week left in the month of March, S&P 500 is trading at 1556.89, so I think this week again it will move towards northwards and able to sustain at 1600 before April starts.

 

Talking about Dow Jones, its trading at 14512 (22nd Mar close) so I think it will hit 15K in this month. So I am bullish on both of this for this month.

[bakrob99 11]

Its only 1 week left in the month of March, S&P 500 is trading at 1556.89, so I think this week again it will move towards northwards and able to sustain at 1600 before April starts.

 

Talking about Dow Jones, its trading at 14512 (22nd Mar close) so I think it will hit 15K in this month. So I am bullish on both of this for this month.

 

I would continue to be long biased at least and until I had a weekly close below the low of a prior week.

[ntrader 10]

I will just follow the trend...

[ntrader 10]

Despite some not-so-hot economic news, we got a new all-time high in the S&P 500. The S&P 500 is now up 10.03% for 2013. The 200dma is 1436, which means that the current price is 9% above where it has traded on average over the past 200 days.

[steve46 12]

Always interesting to read the retail opinion on the markets. What stands out is the lack of organization, and focus.

 

Commercial participants look at it a bit differently

 

There are three basic orientations, Seasonal, Intraday and Event Driven News.

 

Each day prior to the RTH open I go through a standardized routine evaluating these data sets.

 

Seasonal is based on institutional targets (I call them time based pivots). Institutional participants get paid based on whether they hit or exceed these targets AND on the profit or losses accumulated as they manage inventories.

 

Intraday is based on the tendency of commercial participants to A) look for liquidity and B) to try to squeeze one side or the other when there is an obvious imbalance.

 

News driven events occur regularly and are used as the rationale for marking markets up or down in order to buy (at a discount to value) or to sell (at a premium). That cycle is replayed over various time periods (related to the time based pivots) from intraday to weekly, and from weekly to quarterly, and finally from quarterly to yearly (close) and on to the start of the new year. The current cycle is based on the quarterly time period and focuses on the Euro/Cypriot bank situation and domestically on the effects of sequestration and (soon) tax season.

 

Based on this orientation there are three types of opportunities, each with its own time frame and each with differing profit (and loss) possibilities.

 

Constrained by time (I have to get ready for the Globex open) I have to stop here

 

Good luck folks

Edited March 31, 2013 by steve46

[Larry1234 10]

When we talk about the Even Driven Strategy, i feel its not helpful for a trader because many times I have seen that the event (news) is negative for the market, but still market moves upwards and vice versa.

 

How do you use this strategy to make trading decisions ?

[steve46 12]

Events provide one (1) data point among several that we evaluate. Accurate evaluation of the potential impact of the event is the key point....for the retail trader then, it becomes a matter of first asking yourself "do I have sufficient experience with events (reports, earnings, etc) to use this in my decision making process"? If the answer is no...you have in effect simplified your process....you simply exit trades prior to the event. If on the other hand you have sufficient experience or access to someone who DOES have that experience, you incorporate that into your decision process. I am holding a position currently so I have to stop there, but I will go a bit further as soon as I have some time...

 

Thanks for your question...I think its a very good one to resolve and I will try to add some value to that issue later today.

 

Best Regards

Steve

[steve46 12]

Okay so some of this will depend on whether you (the reader) can connect the dots. First here is a quote (not good form to quote oneself but time is at a premium for me so...)

 

"Germany opened up and London followed suit...several reports (pertaining to the Euro) and the results were mixed. From a value standpoint, during the Globex price stayed above previous value area low, suggesting that participants continue see value higher up the ladder. This makes sense because the particpants we are talking about during the overnight session are Asia and Europe and because their own markets are doing poorly they are motivated to look to the US market for opportunity....as long as the news is not significantly negative, clearly they (European institutional participants) will want to mark the market up...."

 

The way to handle events (if you have limited experience) is to know that A) in a market dominated by professionals, there are going to be others who have a good idea of how a pending report will play out.....and B) because they have a good idea of what is going to transpire they are likely to get on board prior to the event.....and by prior I mean hours in advance of the report or event.....So what do you do, well one thing that you can do is to look back to the European open to see how they factor in the impact of reports (like today's Factory Orders report released at 7am PST)....

 

and finally, we have to understand "context"....and that is the main point of my quote....in an environment where everyone is looking for a way to make money, and Europe is in a recession, unless the "news" is very bad....participants are likely (as has been pointed out) to ignore even mildly unfavorable news and buy the market....and once again today, that is what happened...

 

From my point of view it is about putting the pieces together and getting your thought process aligned with those who have the horsepower to move the market...if you understand how those folks think about events, then, when they decide to put money to work, you can recognize the opportunity and "go with" it.

 

Hope that helps