FT has been trading full time from home for two years, with nothing but four kids and a beach to distract him .
He fills his spare time with weight training and rugby, though more coaching than playing these days.
FT mostly trades the forex markets and although he plays FTSE on occasions his bread and butter market is £$.
He likes to think that his technique is evolving but still hasn’t the temperament or money to back the big calls. He prefers to trade between 1 and 3 times a day, aiming to take regular small gains, but feels part of the evolution is in not dealing if the conditions don’t feel right.
What Happened To Quiet Mondays?
Morning folks,
Traditionally we ease our way into Mondays; perhaps a few minutes late to the desk, time for a scratch and chat about the football or rugby. You know the sort of thing. But not this morning, it was straight in for a bit of action.
Just in case you spent the weekend on the moon, or you’re Welsh and have only just got back from Saturday’s game, lots of Americans have been very busy over the weekend.
Last week’s basket case, Bear Stearns, has been bought by JP Morgan for little more than a bag of wine-gums. The Fed made its weekly announcement of special measures, except this was the first emergency action to be taken over a weekend for 3 decades. The poor old Fed is in a no-win situation; it’s desperately trying to push through measures to ease concerns in the market. But, just like a young lad on a first date, it’s in danger of trying too hard. The more special measures that the Fed comes up with, the more the markets are getting spooked (if the Fed’s that worried, what else do they know?).
There’s a danger of the same reaction tomorrow evening; the market is increasingly putting its money on a 1% cut in US rates. This means that if the Fed only cuts by 0.75% then it risks disappointing the market, and possibly being punished with a further drop in equities. On the other hand, if it does cut by 1% then it risks the spooking the market, and it has one less weapon in its armoury.
Me, I’m back selling FTSE today. I sold £1 early on, but was stopped out for a measly £11 gain. Later on I sold a further £2 at 5505, but there’s a subtle change to my tactics. Don’t take this the wrong way, I’m not getting bullish, but I’ve dragged my stops right down.
There’s a very real danger that we hit new lows in equities. Equally, with the mood turning so bearish, I reckon there’s a chance of a sharp bounce at some point. I suspect it will only be of the dead-cat variety in a bear market, but I reckon I can increase my returns by jobbing in and out a bit more. The long-term short has worked very nicely thank-you, but by trading more actively I could have boosted my returns by a whole lot more. So I’ve trailed my stop loss on my total short position down to 5530.
I’m a simple guy and multi-tasking has never come easy. Whilst messing around in equities I missed out on a 200-pip collapse in GBPUSD; now that would have been a smart one to get right. Check out the gold price as well, it’s hit a new high at over $1024.
There’s bags of rumours doing the rounds, focussing on the other US banks due to report this week. Lehmans is the main one in the spotlight, but after Bear Stearns was found to be lying last week, it’s an easy game for traders to play.
Happy Trading
March 17th, 2008 at 2:29 pm
Yeah, you’ve got to take your profits when they’re on offer in these conditions.
Having seen my Rightmove “profits” gobbled up on a couple of occasions when the price bounced from mid-470s back up to 490s, I’ve closed half my positions at 478 - 479 and moved my stop on the rest to 489 (again). If it goes back up to here, there has to be a good chance of another bite of the cherry near the 20MA resistance that’s still up close to 500.
Also closed out my Intertek short from last week at 945, rather later than I’d hoped, but still for 10 points profit, so can’t complain.
Opened a new long position on Aviva at 549, where there’s been repeated support and I’ve traded before. Now up around 555 bid, so thinking about moving my stop up.
Also tempted by another stab at an L&G long below 120 to take advantage of the 118-130 trading range — although GG’s warning is ringing in my ears.
But remain bearish overall.
March 17th, 2008 at 2:41 pm
Good stuff, lots of 10 points all adding up. I closed £2 of my FTSE short at 5454. Market looked to be turning from short-term overdone. Just missed being stopped out on the balance a few minutes ago. Went a small long in Barclays at 396, but P/L will be the difference between steak and pizza for family tea, no more. Yeah still bearish, but feel more jumpy when everyone else is. Of course, sometimes the crowd’s right. US banks apart, not sure what other games are being played ahead of option expiry (and Easter break).
March 17th, 2008 at 2:44 pm
Ah ha, just been stopped out of FTSE short, watch the market tumble now!
March 17th, 2008 at 3:53 pm
Yep, a nice tumble which stopped me out my Aviva long at 553. So should start going back up again anytime now
March 17th, 2008 at 3:58 pm
I opened up new shorts in FTSE and Dow, but shut down dow for a small profit too early.Shame, it would be looking good now, but I need those steel testicles for trading the Dow. barclays back to break-even.
March 17th, 2008 at 4:22 pm
Caveat L&G unless you know the figures-which are tomorrow! Or a strong view on markets.
Sorry had head down in ‘How can I repair this *&&)ing computer manual-any java /flash experts out there. No not the ones in plimsolls and a see through mac!
And I stayed up for an ‘interesting’ Jap session in which my position lost —oooh about 230pips in 5 minutes. Tin gonads time!!
March 17th, 2008 at 7:37 pm
Thanks, GG. Didn’t get in on L&G before it headed back above 120 — maybe just as well.
Closed out the rest of my RightMove short at 478. So no trading positions left open — which is where I think I want to be tonight.