Emini Futures Rollover Into Solar Storm 03/08/12
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US and European Markets staged a continued rally into tonight's solar storm. The storm is part of the sun’s normal 11-year cycle, which is supposed to reach a peak next year. Solar storms don’t harm people, but they do disrupt technology. And during the last peak around 2002, experts learned that GPS was vulnerable to solar outbursts.There is also a theory that along with disrupting technology these solar storms can have a dramatic effect on the financial markets. The Atlanta Fed commissioned a study of this phenomena in 2003. According to the report stocks tend to underperform during the days following a solar storm.
The chart below is from the Atlanta Fed report. The figure displays the bar graphs of the returns on the NASDAQ, S&P500, AMEX, and NYSE (NY) stock market indices during normal days (left column) and bad days (right column). The report defines the six calendar days after a storm as bad days and the remaining calendar days as normal days.
With Unemployment numbers due out tomorrow morning the storm may be more than a tempest in a tea cup. Consider being flat ahead of the number unless you are an experieinced news trader. (or weatherman)
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