Now that the politicians have decided that Greece is beyond saving, focus is quickly moving onto the next challenge, Italy. Yesterday, the country staged another bond auction, the treasury sold €3.9 billion for a yield of 5.6%, up 0,7% from the July 14th auction. More concerning than the rate increase however, was that the demand was notably down. As a result, the benchmark rate rose to 5,75%, approaching the levels from early August, when the ECB stepped in. Read more

Tags asset allocation - bull bear psychology - derivatives trading - excessive investor pessimism - italian bonds - market psychology - risk on risk off - sentiment momentum - system trading - trading strategy

Following our mention of sentiment “trigger points” last week, we received several questions on how SentiTrade identifies momentum in market psychology. Normally, trigger points refer to psychological price levels that will “trigger” certain behaviors. For example, if prices of gasoline suddenly rose to €2 per liter, it is reasonable to assume that driving patterns will change. The cost of driving traditional cars, may furthermore “trigger” an increase in sales of hybrid- and electric cars. Read more

Tags asset allocation - bull bear psychology - computer linguistics - confirmation bias - corrective waves - derivatives trading - investment strategy - market prediction - market psychology - market sentiment - overreaction hypothesis - risk on risk off - sentiment trigger point