Weekly updates- November 02, 2012

PFGThere is a website that is setup for creditors.

www.pfgchapter7.com

Everyone can fill out forms there.

You can submit the claims online or by mail.

This was quite a week, wasn’t it?

It was the first time since 1888 that the market had been closed for two days due to weather.

Next week we should see a lot more volatility in the market due to the presidential election in the U.S.

As I have already stated, if Romney wins, we would expect the market to rally.  If Obama wins, it may stay the same or decrease.

Since the election polls are so close, I would opt to sit on the sidelines before the election and start trading again on Tuesday night, when the winner becomes clear.

We can take advantage of night trading with forex and S&P Eminis.

This is a good time to consider the up down advanced algo.

It may be time to start to look at the Yen.  The Bank of Japan is under tremendous pressure to ease again.  The last time was not effective.  The positive results from the U.S. also hurt the Yen.  The Yen has been dropping versus nearly all other currencies.  Keep an eye out for trading opportunities.

At the end of the week, we can start to look for stocks. We are now in the statistically bullish 6-month window. 

I will send out another update on Wednesday.

The VIX is still not as high as I would like, but it is getting closer. 

Someone was asking whether a trader can sell straddles in a different ratio than the underlying .

The answer is “yes”.

For example, you can use the up down algo to trade 10 of the underlying and sell 8 straddles.  By doing this, you take in premium to offset the loss created when the market is not trending. You will also make money when the market breaks out of a trend. This does not work exclusively with the up down advanced.  You can use the Ultimate MAVE as well, for example.

I will be in touch on Wednesday. 

Kind regards

Melvin

The article was first published by RTT Quant.