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.
I Had To Buy Sterling On St George’s Day
Happy St Georges Day. And a very Happy Birthday to young Willy Shakespeare.
I just had to buy Sterling on St George’s Day; luckily I chose a time when it was going up.
It wasn’t a great trade; the Bank of England minutes gave me a golden opportunity and I’ve got to say I made a pig’s arse of it. The market was going for a 9-0 vote in favour of the last 0.25% rate cut, with the smart money on a possible 8-1 (the 1 being Blanchflower voting for a 0.5% cut).
The result was much more fun with two members voting against last time’s cut. Ignite the rocket launchers we have blast off.
I had to pay up around 20 pips to get involved, but figured I’d soon cover my costs. I opened a £10 buy bet at $1.9925 and was soon able to close my customary £5 bet for a profit. I combined the sell bet at $1.9939 with trailing my stop up to just above break even. Sometimes these violent reactions are all testosterone and no substance so I wanted to protect my gains. I took further profits at $1.9946 and $1.9953, but for some crazy reason didn’t sell when the price hit the $1.9960-70 area.
The consequence of that was losing my final £3 back down at $1.9926 as the rally ran out of steam. Total profit on the trade was £122; it could have been quite a bit better, but it was a quicker return than my short bets in banks, and it was enough to treat the missus to a ponsy coffee over at the shops.
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Ah, and talking of testosterone-fuelled rallies here’s a thing. Last week the press was full of a study linking the size of traders’ profits to their levels of testosterone. That was all fine and dandy, large testicles equals big profits, which as we all know, attracts good looking women.
And yet paddypowertrader had it’s wrists slapped for ’suggesting increased sexual prowess was linked to online betting’ with their ‘who says you can’t make money being short?’ campaign. Perhaps we should have called it a survey!
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After all my bleating on about going short I missed the great shorting opportunity in FTSE this morning, though I did make some gains on my short bets in Barclays and Alliance & Leicester. Alliance & Leicester are now over 50p lower than my sell price, though a chunk of that is lost to a dividend adjustment; Barclays is a straight 40p lower. Looking at the chart, Barclays is nearing a previous support level so I need to weigh up either taking profits or setting a tight stop.
On FTSE, I want a convincing failure to re-take the 6000 level before really backing the bear track. So far today it’s managed to haul itself back above, after a helping hand from Dow futures.
Oh, and if you bunked off Literacy classes at school you might be wondering who the heck Willy Shakespeare is. He’s the guy who went into the pub and asked for a pint of Guinness, but the barman replied, “Sorry Mate, I can’t serve you. You’re bard.”
Happy Trading
April 23rd, 2008 at 5:23 pm
I think that’s what the cliche lovers call a roller-coaster ride. So, that was a roller-coaster ride today.
Looked like FTSE was struggling to hold the mid morning levels, which meant that little voice whispering short, short was getting louder. Eventually gave in, but mindful of my exposure on the written 6200 calls, I kept it to a couple of quid on a PP FTSE cash short at 6042.
Bought back £1 at 6024 and the other one at 6005.
Didn’t catch, or anticipate, the ride all the way back up to 6080. Which is a shame. But it beats faffing around with a currency from a country that didn’t even invent cuckoo clocks.
Looks like the Wall St rally is dying, could be we’ll see another effort to exit the 6000 level tomorrow morning?
April 23rd, 2008 at 6:53 pm
Keep ‘em peeled (ho ho!) for Apple after the close-might get a directional pull then-though I think Ambac is doing its best to knock the stuffing out the financials again.
If it wasn’t for Boeing and GM I reckon the Dow would be a short ton.
April 24th, 2008 at 10:29 am
Onward and downward?
If you draw a line connecting the Oct, Dec and Jan peaks in the FTSE then this is where it bounced yesterday on its way back up to 6080. This morning, FTSE has torn through that line but is now knocking up against it. So support yesterday but could it be establishing resistance today with more falls on the way? Bye bye 6000.
April 24th, 2008 at 11:59 am
Good obs ken-I have been looking at the horizontal line of late Aug/Nov lows plus resistance in Feb & Mar, so had missed the downtrend line. Back to the 38.2 fib at 5840? or the 61.8 at 5680
Thankfully the Dow is also retreating from a similar breakout area at 12800-850.
just waiting for the BARC rights issue………or sovereign wealth fund injection!
April 24th, 2008 at 12:36 pm
Well, the resistance hasn’t held so I’ve gone long on FTSE at 5981. Just a quid but it’s now a no-lose position that’s hedging my written call in a small way.
Jump on quick if you want to catch the ride back up!
April 24th, 2008 at 12:50 pm
You’re on a profit and long-quick take it! I went long in a couple y’day at just above there. Didn’t feel right so I closed for a £2 loss. Then the market took off like an Amy Winehouse frenzy. Re techs I’m naturally bearish, but still want a close below 6000. At this rate I might throw in the towel and write a scrap of puts, just to tempt the bear out of the cave.
April 24th, 2008 at 1:09 pm
Puts were starting to look tempting this morning with the May 5500 prem sneaking into double figures… but I didn’t bite. He who hesitates…
Stop on my long FTSE spreadbet guarantees a small profit, happy to stick with it for now and see what the Wall St open brings (assuming I’m not stopped out before then).
April 24th, 2008 at 1:13 pm
Seems like a head of steam building up that the Fed’s next cut could be 25 rather than 50-and then a wait and see. possibility of no cut. Aided by better jobs and durable no’s today.
I’m getting keener on the $ but not sure against what (?jpy as still positive carry but gets donald ducked when the market falls?) but perhaps keener on going short gold. Or going short short bonds as yields back up?
Any suggestions?
Though I didn’t trade it see the U completed in EUR/CHF
April 24th, 2008 at 4:29 pm
Full marks if you ran your FTSE long Ken. Should pay for tea tonight. Yeah, I’d re-set my sights on 5500 puts, but with the reaction of a diplodocus I missed the window-now they’re about 3p. bank shares had a good close (but not for me)
April 24th, 2008 at 4:47 pm
Not quite. I got stopped out at 6019 for a £38 profit just after the US open. So avoided squeaky bum time as FTSE sank through the afternoon but didn’t participate in the late rally. But every little helps, as they say in Cheshunt.
On the $, I also think its time is coming. But staying long of gold as long as the 30-week MA continues to hold. Tempted by corporate debt but think there may be a bit more to shake out first.
Best play for me is shorting cable. We’ve got all the problems the US has, only worse and with a 6-9 month lag. Plus our economy isn’t as big, robust and diversified so is going to take the hit harder. And the Gov doesn’t have the leeway to intervene (stability, strength, prudence, yeah, yeah, yeah tell us another porky Gordon — anyone remember the last time he spoke truthfully?).
Every Labour government engineers a currency crisis. This one will be no different. Serendipity has allowed Gordon to survive longer than most but boy are the chickens flocking in to roost now.
So even if the $ doesn’t rise phoenix-like, it only has to outperform relative to sterling to make money for a GBPUSD short. That’s what you call setting a low bar.