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.
The UK Economy Is Sinking In The Brown Stuff
Cor, what’s that horrible burning smell? It must be the remains of grilled chancellor from yesterday’s Newsnight programme. The voters of Crewe and Nantwich should feel flattered that they warrant a £2.7 billion tax giveaway, a Savings Bill, a Banking Bill and a Gordon Brown housing package.
Meanwhile the highlights of the Bank of England’s Quarterly Inflation Report read like a Stephen King horror story. The slowdown in growth is now expected to be more prolonged than previously thought. But with inflation expectations also higher than before there’s little room for interest rate cuts. Already several City analysts have changed their forecasts to expect no more rate cuts this year. That’s not what Gordon Brown wants to hear, especially if he’s investing taxpayers’ money in trying to support the housing market.
Poor old Mervyn King is likely to suffer from writer’s cramp over the summer months, writing letters to explain why inflation is above the target range, but without blaming Gordon Brown for (very publicly) wanting lower interest rates.
There was a faint whiff of singed bear coming from this office earlier this morning. I’m afraid I rebelled and opened another short bet on FTSE, even though the price was still clinging by its fingertips to the bullish uptrend. In fairness, the bulls point to yesterday’s strong rebound (again) from support at 6150, and they’ve got a point.
But my point is, apart from the overwhelmingly worrying economic background, that the rallies aren’t quite reaching the level of the previous rally. And the sell offs are venturing just a bit lower each time. Once again, the price has fallen below the daily uptrend line but has yet to close below it.
Also, technical analysts are like politicians and women; they can choose the facts to support their case. Getting impatient in waiting for FTSE to close below the daily uptrend line, I scaled down to an hourly chart and drew a shorter uptrend line from the low of April 24th. Now, If I want to treat this chart as a lead indicator, not only has the trend been broken but successive attempts to rally above the line have failed.
So anyway, I sold FTSE in a fiver, placing a £3 bet at 6202 and £2 at 6204; the idea was that I’d trade the £2, but leave the £3 as a longer term play. I bought my £2 trading bet back at 6177 when the market showed no inclination to test the 6150 support. This stuck £54 in my back pocket. As planned, I left my £3 bet open and lost all this morning’s gains and a little bit more.
A marginally better than expected US inflation number has given markets the horn in early trading; so far the FTSE rally has failed to break my hourly uptrend line, but it’s back above the daily line-just. I’m looking to open another short bet in FTSE, but patience is dragging me back by the nuts and telling me not to rush, there’s likely to be a better opportunity.
Happy Trading
May 14th, 2008 at 3:10 pm
Yeah, apparently that £2.7bn that we’re spending on trying to save Crewe & Whatsit for Gordon works out at £380,000 for each voter in his 7000 majority there.
Interesting (!) FTSE trade today. Due to crass stupidity and incompetence just after the close yesterday, I managed to open a £2 FTSE short in one account and simultaneously open a £2 long in another. D’uh.
Only noticed the cock-up this morning. But retreived a bad situation by buying back the short just before the US numbers (when the trend line seemed to be holding for the Nth day in succession) then selling the long just after when the FTSE had moved back above 6200. So got out with about £40 profit but not quite what I’d intended.
Wrote some 6500 and 6550 calls for June as the price peaked today. Surely we won’t be up at those levels in 5 weeks?
May 14th, 2008 at 3:46 pm
Surely, surely the markets can’t stay irrational for another 5 weeks. Yeah, I’ve been writing 6600 and 6650s, but toying with writing some closer to the money. Came close to writing 5550 puts for 15 this morning, but the bear within me told me not to rush as we’re due a decent drop once the trend has been established. I usually find writing a few puts is like waving a red rag at a bear.
Good that you benefited from Man United syndrome, still making money even on the bad days.
Look forward to a thursday full of earnings and eco numbers
May 14th, 2008 at 8:57 pm
Hi FT,
That’d be about right, Gordon Brown’s timing in matters financial just seems a few steps out of kilter. Still, he can’t really blame anyone else having been in the position of chancellor for so long. And Darling, well words fail me. This Labour leadership is possibly the worst I can recall. Poor Gordon, he coveted that top position for so long and now he’s making a complete pigs ear of it, more U-turns than the Stelvio Pass.
I see the DOW dropped dramatically from its highs, after shooting up again initially on the CPI numbers. Bloomberg spells out that inflation is receding. Ho Hum. Whats that saying about one swallow and a summer. As www.minyanville.com decribes so well, inflation is created by too much money in the system…….and who put it there, Bernanke, Paulson and his cronies.
Still, having had to ride out those highs with a tight bottom, my shorts were justified with a tidy profit for the day, again tracking short orders higher as the market rose. Hopefully, these markets will get back to tradable trends soon, maybe as soon as the FED stop intervening and let the market sort itself out.
GP