Went long myself, targeting new highs. Old Turkey would cock his head to one side, contemplate his fellow customer with a fatherly smile, and finally he would say very impressively, "You know, it's a bull market!"
The thing I dislike about that play is if we see new highs, then just get long again. You miss 20 points. Whereas if a selloff develops - and there are a lot of reasons for a conflict like this to potentially cause a proper selloff - then you lose what...50, 100, 200, 300 points. The risk/reward is all wrong for buying here - win a bit, or lose your shirt. In fact you can probably short right here in the mid 1840s and risk no more than 10 ES Points if wrong. Being long in a bull market is usually the correct play. Being long in a bull market after a big runup in a short time, when the news situation has just gone from plain skies to storm clouds, is definitely not the correct play, even though sometimes it may work. When it works it makes a bit, when it doesn't work it loses bad. P.S. for daytraders, a classic pattern on bad surprise news is i) big gap down ii) early rally (usually between 30 mins and 2 hours) iii) break back below the opening range iv) massive puke later into the close v) follow through weakness early the next day. Happened after 9/11, after the Tokyo earthquake, and many other overnight bad news surprises. So if we go much below 1838 (opening lows) then scaling into some shorts with a stop at the day highs (currently 1849.50) might be worth a punt.
Disagree, I went long at 1840, stop is at 32, and and targeting highs at around 62, Pretty good risk/reward. Of course that doesn't say anything about the probabilities of target reached before stopped out, but I am confident of the resumption of the bull market.
Pretty sure that did not happen on 9/11...I was long es, was stopped out after the first plane hit, market went back up a few points and then plummeted after the 2nd plane hit. All happened in the space of 5-10 mins.
If your target is 62 then you are not betting on a resumption of the bull market, you are betting on a small 22 point move back to the highs. I.e. your trade thesis is different to your position. If we do go quickly back to 62, I would want to be long, not go flat, as it would show the market is very strong to shrug off such bearish news so quickly. Also the risk/reward is irrelevant in isolation, the trade odds also depend on the chance of the trade working. And the closer the stop, the worse the chance of a winning trade. Otherwise we could just set a 1 point stop and a 100 point price target and mint money consistently.
I meant on the day they resumed trading after the 4 days of market closure. On 9/11 itself the stock market didn't open.
Sorry , meant at least 62., would want to lighten up there if reached. Already mentioned the point about the unknown probabilities in my post.
was lucky yesterday, price went to 0.25 of a point to my stop! partially exited at 1862 today. stop to break even on the rest