The speed at which markets react to political and economic headlines in an ALGO-driven world can create volatility that preys upon key levels. Today was a classic example as the long revered 200-day moving average in the E-mini S&P futures was violated and momentum moved quickly to the sell side. The S&Ps closed below the frequently tested long-term moving average of 2589.76 on a CQG continuation chart of the e-minis. In the last 30 minutes of trading at the New York Stock Exchange, there was a report that the Trump White House was pushing for a NAFTA overhaul deal within two weeks. The Mexican peso staged a late rally for it had been unable to withstand the intense selloff of the U.S. equity market. Several of the regular haven investments experienced rallies (YEN, GOLD, SILVER), but the U.S. Treasuries closed virtually unchanged as economic data reflected fears about underlying price pressures since ISM manufacturing prices rose.
Posts Tagged ‘algo trading’
Notes From Underground: What Hath ALGOS Wrought?
April 2, 2018Notes From Underground: Everybody Is Talking At Me, Can’t Hear a Word They’re Saying (Only the Echoes of the Bonds)
May 21, 2013This week has been loaded with FED OFFICIALS filling the airwaves with thoughts about ending QE or just tapering, with the markets left to discern how, when and how much. Today, the NY FED President presented a speech at the Japan Society in New York City, titled, “Lessons at the Zero Bound: The Japanese and U.S. Experience.” President Dudley compared and contrasted the mistakes made by the Japanese and U.S. monetary authorities and what they had been able to learn from each other. The speech was not critical about recent Japanese monetary moves, which infers that the FED is very comfortable with current BOJ policy. The NYFRB president does tell seem to support Chairman Bernanke in being a ’37er, meaning the FED cannot allow the mistakes made in 1937 by the U.S. Treasury and Federal Reserve Board to recur. This belief emphasizes that deflation is the most powerful variable that can disrupt the political economy.