FED'S DECISION

After last nights FED decision to raise interest rate, citing resource utilization and commodity prices as having "the potential to add to inflation pressures." The markets sharply fell and today the market seems to wait what next but we could expect the intrest rate, so what?

Is there a disappointment here? "In any event, the Committee will respond to changes in economic prospects as needed to foster these objectives."
(Federal reserve realease)

Did we expect Bernanke saying the interest rates will never rise in the future again? The FED will raise interst rates wehn they think it is necessary to do so, be it Bernanke or Greenspan. Nothing abnormal.

The DOW JONES at outbreak levels but still within the upgoing trend and recovering at the moment. See graph.

FED
Dow Jones

FOLLOW THE TRENDS

John Henry discussing about his trading philosophy, claiming no knowledge of the future (nobody does) but allways following the trend.

"I knew I could not predict anything, and that is why we decided to follow trends, and that is why we've been so successful. We simply follow trends. No matter how ridiculous those trends appear to be at the beginning, and no matter how extended or how irrational they seem at the end, we follow trends."



I was thinking about the strong trends we see on the markets these days, despite todays losses, when reading Henry's article. See first the German DAX trending since November of last year, reaching for years high of 6000.

The DOW JONES trending above the narrowing rising channel. Even a correction to 11100 would maintain this existing trend.

Systemtrading
Dow Jones
trends

BIG DOW FUTURE STARTED TRADING FRIDAY

Last friday the CBOT started trading the big sized DOW future (symbol DD). The multiplier is 25$ so now we have the mini DOW (5$ per point), The DJIA future worth 10$ per point and the big DOW. The big DOW wil only be traded electronically. The contract specifications being the normal ones.

The first day volume was not big: only 246 futures were traded. It will be a product for bigger traders.

BIG DOW future
Dow Jones