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.
A Glimmer Of Light For Gold
Afternoon folks,
Welcome to breakout day. Equities might be having an uncertain day, the FTSE torn between an OK Dow and a very sickly Dax, but the forex boys know what to do. They’re selling the dollar big time. This resulted in the EURUSD breaking out of its triangular pattern and gold pushing back above $750.
Firstly, my thanks to the Mole for enlightening me this morning. His Market Watch explained the end of session monkey business in the Dow and left me more confident in keeping my FTSE short bet open. I closed off some of it during this morning’s fall for a handy profit, but gave some of it back with an ill-timed short below 4100, which I stopped out this afternoon.
These markets are getting pretty twisted, with several relationships breaking down. The Dow seems to be behaving fine, but the Dax has got a real attitude problem today. At the time of writing it’s off 3.5%, largely due to poor numbers from BASF. The FTSE’s trading in a confused state somewhere in between. To me, it’s trading heavy, with the risk of dropping to test the 4000 level, but in truth I’ve struggled to trade the bear tack at the lower levels. I’m now sat with a small core short and leaving the peripheral trading for the moment.
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Check out the currency market. I’m not sure what started it, but traders are selling the Dollar like it’s yesterday’s fashion. This has helped push the EURUSD rate out of its comfort zone. For a few days now I’ve been banging on about this currency pair trading in an ever-tightening range (Banks Lead Equities Lower).I wasn’t sure which way the price would break; just that it was due to break soon.
This afternoon saw a break to the upside, taking out resistance at $1.2702 and moving swiftly up to $1.2813. I tested the water with a £1 bet, but ideally want to see a daily close above $1.27 before getting too enthusiastic. Also note the EURYEN price, currently at Y123.30, but early having a sniff at Y124. This is even more significant given the sell-off in Dax and FTSE, but bears out what I was saying yesterday about the disconnect with equity market moves.
Another consequence of the weaker Dollar was the new found enthusiasm for gold. The shiny metal broke above the significant $750 level, and pushed above its 21-day moving average.
You can see from the chart that there’ve been several false dawns where gold has broken the $750, pushed forward a few Dollars, but been unable to hold its own. So, tempting though it was, I left the gold long bet, at least until its put down a firm marker above $750.
Don’t forget the release of minutes from the recent Fed meeting tonight.
Happy Trading
November 19th, 2008 at 4:06 pm
Hah!
today’s blog must hold the record for how quickly it was out of date! my kids would blame the speed of my typing, but I reckon it just typifies how erratic these markets are. I was stopped out of my £1 bet on EURUSD; back to watching that one again.Gold hasn’t held the $750 level-for now and equities made up their mind to go lower. the EURYEN rate has come off, but compare the current price of Y122.6 to last weeks Y118ish when equities were around here.
this is looking like a bad night to be out coaching rugby!
November 19th, 2008 at 5:30 pm
OK, I’m roast beef. Closed my remaining FTSE long. Well done staying short, looks to me like we may be going back to retest the 3700 lows. Then on to the 2003 lows?
Hey, if I’m this gloomy, that must be a buy signal.
November 19th, 2008 at 9:00 pm
S&P gone straight through resistance level of 817.800 next up …
November 20th, 2008 at 11:26 pm
Total rout. All bets off now - we could well see lower lows…
November 20th, 2008 at 2:06 am
ERUJPY no longer leading/following the Dow, wild up/down on dollar. If you want to limit risk (short stops) you’ll need to trade often in this market. If you can stomach big risks, set your stops in far, far away-land.
I’ve been short EURUSD, EURJPY since Early this week, but I had my stops at 1.29 and 126. Needless to say I was way underwater all week, especially at 3pm today, but ended up in profit on all positions.
Will learn from this, don’t trade AFTER a big move (Monday open), too risky.
Am at a loss what to do now, futures on Dow up, currencies stable. Time to check the calendar for Thursday…..