TRENDING
Okay, it seems like the EUR/USD is on the brink of breaking out plus as you recall my hands are thrashed, so I’m posting this with minimal fluff or entertainment value and then fill in the post with additional analysis and thoughts over the coming hour:
Equity futures pulled an NFL yesterday judging by the complete lack of participation throughout the big roll over day into the 2018 March contract. Fairly unusual at least in my (not so) humble opinion, and it seemed as if everyone rolled (or perhaps not) and then simply walked away.
Equities futures are rolling into their March contracts today which is in part why we saw a distinct increase in realized volatility over the past week or two. Not being a huge fan of rainy winters in the Mediterranean I for one can’t wait for expiration day which also happens to be my spring vacation season. Then again I shouldn’t complain about the weather judging by what some of my trading buddies in Chicago are going through right now. Scraping ice from your windshield is one thing, scraping it off your contact lenses is another.
When equities turns volatile each added gyration serves to stir the collective emotional cesspool of market participants. An unfortunate cognitive bias we as human beings all share is that we tend to see mostly what we want to see, facts, evidence, or reason be damned. Also known as ‘confirmation bias’ this factory installed feature of the human condition seems to particularly live up to its promise when it comes to the trading racket. Throw in a few wild swings and the bulls will regard each drive lower as an obvious dip buying opportunity while the bears see it as clear confirmation that the prevailing trend is weakening.
At The Edge Of The Abyss
