TRADER’S NOTES: Treat the Trump Presser Like a Trending Market
2017-01-11 07:33:25.368 GMT

By Richard K Breslow
(Bloomberg) — In a few hours we’ll be treated to the
President-Elect’s much-anticipated first press conference. I’m
not sure there’s been a more eagerly awaited event of its kind
in memory. Global markets (ex-Mexico and Turkey) have ground to
a halt. You can cut the anticipation with a knife.

* Will the powerful trends we’ve seen for the last two months
continue? Or reverse with a vengeance? All will be revealed.
And investors will know exactly which the best trades to set
up their year are. Don’t get your hopes up. But who knows?
It’s a must-listen in any case
* Investors will do their best to focus on comments and policy
prescriptions specifically aimed at various sectors of the
S&P 500. There will be a natural tendency to try to ignore
as unpricable potential policies that affect massively
important geopolitical and international economic issues.
That might work in trading the S&P financials index this
afternoon. But perhaps not so well for the Asia dollar
index, where the countries comprising that measure are
already being forced to speculate on what the acronym might
be for a China-led economic and security pact
* The markets began motoring on election night after Mr. Trump
made what was considered a sober and constructive acceptance
speech. It will go down in history as the best example of
the bar being set low. I suspect the bar remains low. But it
remains to be seen if these new price levels will require
more than “don’t be outrageous” to sustain themselves and
continue on
* There will be a lot of hearing what you want to hear. And a
lot of self-serving analysis. Do we need fiscal stimulus?
What kind will actually do some good? Can we afford a bigger
deficit and more debt? What sort of deregulation helps, what
hurts? Do markets care if the climate takes a hit? Or will
it conclude, ‘The climate is just fine, thank you, and my
portfolio loves it?’
* Powerful trends tend to confound those looking for a market-
reversal for longer than it seems possible. And if there’s
one trend that’s defied all expectations for a reversal, it
is this election phenomenon. It is probably well worth
hearing the press conference first before speculating on its

* NOTE: “Trader’s Notes” are authored by Richard Breslow, a
former FX trader and fund manager who writes for Bloomberg.
The observations he makes are his own and are not intended
as investment advice

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To contact the reporter on this story:
Richard K Breslow in London at +44-20-3525-7458 or
[email protected]
To contact the editor responsible for this story:
Jenny Paris at +44-20-3525-4044 or
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