Osama Bin Laden Death Rally

Here is a picture of the ES a few hours after the announcement of Osama Bin Laden's death.



The yellow bars are Friday's RTH action on a 30-minute bar chart. The white bars following them are the Sunday night trading. The 13.5 point spike is as a result of the announcement of Osama Bin Laden's death.

Do you remember the S&P500 spike Saddam Hussein was caught? It happened over the weekend and the S&P500 immediately spike 20 points higher. However, over the course of the day the market dropped down and gave back all those gains before the end of the day.

I'm just wondering if all this euphoria over Osama Bin Laden's death will result in the same return-to-normal market action over the course of the day.

What do you think?

What I think? Perfect alibi for a bull trap. Gap up, trade up. Stall once all is in, then fade lower.

The S& P has closed up four consecutive days. What's the probability of a fifth???

Has nothing to do with Osama, but it is a good coincidence. Go short.

I hope this is just a trap. I have been short the ES for a month or so. Yes I am having my hat handed to me, but I see an over extended double top (weekly). So I have been hanging in there. I don't like to trade on news, but all the e-traders do and it moves the market.

My luck: I go long and Japan has and Earthquake, Tsunami, and Nuclear incident. I go short and we finally get our number one terrorist target. I am batting .000.


- James

A coincidence?! LOL.... Yeah, sure. Another factor to consider is the first trading day of the month and $ inflows due to that. Wait for confirmation... And on that note, for the poster who's still short the S&P. Why?! Why not wait for confirmation on that, too? You miss out on a big gap down, but the flip side is what you're experiencing now, and when it finally turns, how much you'll have to make up just to get to even - if ever! Yikes...

The death of bin Laden isn't even an economic news but the market rallied anyway????? I'm short.

TRIVIA
Bin Laden death announcement 1 May 2011.
Adolf Hitler death announcement 1 May 1945.
BELIEVE IT OR NOT

I read somewhere .. traders have less fear of oil supplies being a target with Bin gone .. idk

Today is a Buy day based on TTT. Therefore we need a decline from Friday's highs. Markets had to get back to Friday's high at a minimum

so that spyke up had to be retraced and should go lower.

so far we do have a decline but very small

Originally posted by CaptMoore

I hope this is just a trap. I have been short the ES for a month or so. Yes I am having my hat handed to me, but I see an over extended double top (weekly). So I have been hanging in there. I don't like to trade on news, but all the e-traders do and it moves the market.

My luck: I go long and Japan has and Earthquake, Tsunami, and Nuclear incident. I go short and we finally get our number one terrorist target. I am batting .000.


- James

These are called Black Swan events, the timing of which is completely unpredictable events. Some of them can be reasonably assumed. For example, Japan will probably have another earthquake at some point in the future, so will California. Osama Bin Laden had to die some day etc.

Sorry you got caught the wrong way in the market in 2 of them. Looks like the ES has already reversed significantly in your favor since this topic started though.

For the record, here is how the day turned out. The second set of yellow bars is the RTH session for the ES on 2 May 2011. The overnight death rally spike gave back all its gains just like it did with the Saddam rally.