Friday, November 12, 2010

Stocks and Bonds Trade Lower as QE2 Begins

I had to laugh when I looked at bonds this morning after the Fed announced it had bought $7.2 billion of treasuries as they initiated their QE2 program:

Here is the 10 year bond as I type:

The 30 year bond on the other hand has held up pretty well:

Interesting price action. I am guessing the market might not be happy with the amount of 10 years that were purchased.  This is just speculation based on what I see in the price action.

Mr. Market is also selling off today which is surprising given all of the funny money that was spent by the Fed today.

The DOW is down about 100:

Commodities are selling off sharply.  I have a feeling this is in response to the proposed margin requirement change in the commodities market.  Still looking for details on this info so stay tuned.

I might either sell some metals today or buy some PUT protection.  Interesting day so far to say the least.

China's potential rate hike isn't helping the commodities either.

So far the market has rejected QE2.  Let's see if this is an aberration or the beginning of the trend. 

The way I see it:  Selling this news has the perfect makings for a top in the market.

Until later.


Locked in profits and sold 40% of my silver position in SLV.  Held onto all gold positions.

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