Posted November 05, 2014 Chris Potts
September was a busy month for both the oil and STIR’s markets as important data and speeches were released and digested by markets, however it became clear that certain events had been mispriced into the market. In the first instance oil prices were continuing to drop on the back of weaker than expected growth from China and huge global production rates, which look set to continue especially with shale oil becoming a larger part of the US’s total oil production and further talks on easing the export ban. The STIR’s market Eurodollar, which I was also trading had a significant move as well. This was effectively because inflation expectations have come under pressure from falling oil prices and Janet Yellen’s September FOMC meeting cemented the belief that rate rises were further along the time horizon.
If I were to draw comparisons with other months of trading these markets, I definitely felt I had greater confidence in more of the trades I was entering because my ability to identify positions of value had improved. Moreover, I had a better understanding of market direction and momentum, which allowed me to execute a greater number of successful short and longer term trades. Lastly, I was able to cut the size of positions that I knew were going wrong but also was more patient with some of the positions that I felt were right but perhaps needed more time.
Overall I had a good month and felt rewarded when I received the trader of the month cash prize, which I used to take a couple of friends for dinner at a steakhouse. Hopefully it won’t be too long before I win it again!