Spread Betting Futures Trading
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A regular spread trading update by Simon Denham of Capital Spreads.
For the latest spread trading update from Simon Denham click here.
Spread Trading, 07 Dec 07
Another move higher in the US has given the bulls the upper hand this morning. Needless to say after the volatility of the last few days it would be premature to think that the market will sit at these levels, especially as we have non-farm payroll figure later. Yesterday's move by the BoE seemed to catch a few people off guard, which seems strange considering the market had rallied in the previous session. A rally driven by banking stocks. With the decision going in favour of equities yesterday another positive piece of data today would be required to test the year's highs. Clients remain skeptical selling into the strength and it wouldn't seem an unreasonable view to take considering the news flow over the last few days.
Non-farms will be released at 13h30 so its all hands on deck and a few analysts have been revising their estimates higher. A figure of around 100k would come as no surprise and anything too high may cause people to think there's room to keep interest rates on hold rather than cut and we might see a little profit taking. The worst case scenario would be if the figure came in much lower, the unemployment rate rose and the hourly earnings also came in higher. The higher earnings and higher unemployment would be the first indication that stagflation is a real threat and this could certainly spoil the party for the bulls. Everyone watches the headline figure when the data is released and then picks up on the other pieces afterwards. So a lower headline figure might be construed as a signal for lower rates and send the indices higher, but more likely than not, this is giving us the first signs that the US economy is on the back foot.
At the time of writing we are calling the Wall Street spread betting market to open lower around 50 points lower at 13570 which just shows how nervy the market is about today's figure. It is seen as a real precursor to next Tuesday's interest rate decision in the US where the market expects a further cut of 0.25%, with some hoping for more.
So far gold is trading lower as investors are reluctant to stick their necks out ahead of today's data. Dips continue to attract clients into further long positions. Gold has been remarkably volatile and while there's been a halt the to ever increasing price, a support areas seem to be in place around $790.
Spread Trading, 06 Dec 07
A whippy session last night in the US ended well with Wall Street ending on a high. The optimism felt in the US is clearly contagious as European indices are higher this morning. Despite all the doom and gloom reported by retailers things seem to be going in the right direction for equity markets at the moment. The underlying fact that there is still low unemployment has remained the support for equities and, to assist the bulls, Oil and metal prices have tempered for the time being. Looking at the FTSE the 6500 marker offered little resistance and the next level on most people's radars is 6650. Clients have been slightly caught of guard in the last couple of days believing that the news flow was heavily stacked in favour of the bears, so it would seem that many are hoping for rates to remain on hold to take a little froth off today's and yesterday's moves.
The economic releases today and tomorrow could easily shape the direction for indices into the year end. The latest moves higher only prove people's optimism about the prospect of cut from the BoE today. There is certainly mounting pressure for them to take action and its no wonder that members of the MPC admit that their decisions in the coming months will be more difficult than any they've made in the past 10 years. The majority still believe we'll see them hold, partially because they're playing the waiting game to see what will happen during the rapidly approaching wage rounds.
RBS's trading update provided no shocks and banks have been the main beneficiaries of the last couple of days, particularly Barclays which is proving a favourite for clients as it hurtles back towards the £6 mark.
The ECB will most likely keep rates on hold at 4% with further comments on the risk of inflation and downside risks to growth. Clients are still in favour of the Euro, but the Dollar is managing to hold its ground at these levels. The remainder of the week will be important for indices and could be equally important for currency markets with non-farm payrolls tomorrow to follow today's interest rate announcements.
The double top formed by crude oil in November still has the bears firmly in control again this morning. There's so much of the black stuff above ground that the $100 mark could remain a dream for clients for quite some time to come as they continue to buy on dips.
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Spread Trading, 05 Dec 07
Markets are looking a little happier this morning with the FTSE called some 30 pips up and the Dow regaining much of yesterdays lost ground in overnight Far East activity.
The FTSE continues to be far more volatile than US markets with the high/low range for the FTSE 100 being 115 points. The Dow, twice the size of the FTSE 100, is only putting in 90 point swings. The FTSE 250 fell below the 10200 marker, a 300 point drop.
The performance of the FTSE 250 bears some watching as they are now at around the lows for the year (again), down 10% from last years close. The FTSE 100 is still in positive territory by some 120 points. The lows for the FTSE 100 were back in August at 5825 but the FTSE 250 is now well below here as investors quietly pull out of UK focused stock. Whilst the major stock index is mainly focused on foreign earnings the percentage of overseas earnings in the 250 index is not as high and it is educational to see how the less heralded stocks are doing.
Banking stocks remain under pressure and yields on many are now hovering at the 7% level again. Investors have seen this as a good point to buy in recent weeks but the continued return to the downside is beginning to worry some of the Financial Spreads clients. It appears that there is a solid section of major stock holders who are not convinced by the 'value' argument and are happy to sell out even at these returns.
The last two days has seen some pull back from the recent 400 point rally. However today sees a return to the upside (at least for the open). The first hour of trading is becoming increasingly volatile and punters are starting to focus on the opportunities available in just this period of the trading session. The last seven days (and 11 out of the last 12) has seen the first hour’s direction reversed in the remainder of the session. That has been noticed by a few punters.
Factory orders numbers are out of the States today and dealers will be hoping that manufacturing can remain strong in the increasingly fragile looking US economy. A weak number would bolster demands for swift and deep Fed rate cuts and this may cause the markets to rally even on bad news! Of course if the numbers are very bad then the US indices would come under severe pressure. However, if the numbers are quite good then we may fall as well as dealers fear no (or minor) action from the Fed.
Currency markets are showing a bit of dollar strength once more as dealers look to cover any positions in front of the BOE, ECB and Fed rate decisions over the next week. It is foolish to risk P/L over market reaction to interest rate changes and so short term Dollar bear positions are likely to be liquidated in coming days.
The Cable spread is down at 2.0550-2.0553 and really seems to be stuck in the 2.0515 to 2.0800 range. A break down below here would run into the 2.0445 support and then the volume support below here all the way down to 2.0265. On the up side, there are actually very few resistance levels, mainly due to the lack of much trading history. Having said that, many dealers find it difficult to buy the pound above here (almost on a psychological level) and this is causing its own resistance to moves.
Gold bounced back above $800 and our clients are quite happy. As mentioned yesterday Capital Spreads clients were buying heavily. Their confidence was borne out by the return above the bull trend line at $795 mentioned yesterday. Which then turned into a support level for the rest of the trading session.
Crude Oil had a quiet day (!) on the news that the CIA regards the Iranian nuclear threat as minimal therefore removing any real chance of a US strike. The lack of action is odd as you would have expected weakness in the market.
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Spread Trading, 04 Dec 07
Well yesterday was pretty much a small retracement of Fridays moves as Cable, Gold and Crude Oil rose and the Indices and Dollar fell.
What we now need to know is whether this is a short term retracement of the bigger moves or if we are going to see more upside on the Equities and further weakness on Commodities and the Dollar.
OPEC, having stated last week that they would be looking to ease supply worries, announced that they saw no problems with the current levels. Frankly, nor would I find any problem with current supply levels if I was selling a product at $90 a barrel which cost me only a few bucks to extract. The impact of this comment on oil was to retrace much of Fridays fall. This morning the market is opening just above $90 for the January Brent, up another 40c overnight.
The FTSE is called just a tad lower on the off this morning at around the 6380 level and punters remain on the Short side having ridden the fall yesterday. The markets appeared to be calmer yesterday but the high/low range was still over 90 points which hardly a comatose level of trading. Mining and Retail stocks were the losers and Banking the gainers overall. The high street remains a bit of a battle ground and the remaining sectors are not exactly over extended which will give bulls optimism.
Today sees almost no economic data aside from EU producer prices and very little corporate news out of the UK majors so there may be a quiet opening in the early session.
The Dow Jones looked to have weathered the afternoon sell off but the late evening saw the market give up some 70 points to close near the lows for the day. The total range for the index was just 110 points only slightly greater than the 50% smaller and more comprehensive FTSE 100 which was something of a relief for our hard pressed dealers. Today doesn’t look much more inspiring and there are hopes for a calmer run up to the Christmas trading period.
On the currency front, the dollar returned to the weak side and this morning is mixed as the Yen tries to regain the bullish momentum of past weeks. Our clients very short of both the USD / JPY and GBP / USD cross rates making for a yen vs sterling play as the biggest game on the open. The pound has managed to hold onto the low 220's support versus the yen but has (on the other hand) not made a swift return to the 230 level. There seems to be certain reluctance at 129.30 to take the cross any higher and we failed here on Wednesday, Thursday and Friday last week. Yesterday 228.40 also made something of a resistance to further upside moves. Punters will be watching for any breaks out of these levels to get out of shorts but are, in the main, looking for selling opportunities at the moment.
Gold rallied a few bucks yesterday but could not manage to break back above the medium term bullish trend line which was broken on Friday. Resistance today is at $795.5 but our clients are still buying strongly on any weakness. The mid $770's seem to have very strong support but we expect that, unless the dollar moves dramatically, today’s trading will be between these levels.
Spread Trading, 03 Dec 07
So the markets continue to wing all over the place and the Dow made no exception on Friday night falling and then rising 120 points in the last two hours of trading. Not one for the faint hearted.
The Far East has been pretty mixed this morning and this has caused some profit taking in US futures in early activity which means that the FTSE is being called about 10 lower on the off. The FTSE 100 spread is around 6420-6421 a mere 380 pips up on the lows of last week. I would like to say that our clients called the recent move higher correctly but the sharp falls last Monday brought the bears out to play which caused quite a bit of pain on Wednesday and Friday.
Sellers remain in the majority with all our most popular indices (Dow 30, S&P 500, FTSE 100 and Dax 30) showing clients holding strong overall short positions. The opening levels today will be give a bit more confidence to the doom mongers. The report from Morgan Stanley over the weekend on the state of the UK economy will not be giving sellers cause for concern.
The analysts have commented that the UK has wasted 15 years of growth by splurging the wealth created on useless government expenditure. The Public deficit is one of the worst in the OECD and this is after years of growth AND with one of the highest tax regimes in the western world. If there is a slowdown the governments finances will very ,very, swiftly turn into a disaster story. If the Public sector deficit is not brought under control Gordon Brown risks going down in history as one of the worst Chancellors of the Exchequer ever and probably one of the shortest serving Prime Ministers.
Resistance is at the 6455 level, which was confirmed by being the recorded high on Friday. It will probably take a serious FTSE assault to get through that level without some help from the US and Continental indices. Early German trading is sending the Dax slightly lower but market action is some of the quietest that we’ve seen recently. FTSE support is at 6400 which proved in September and October to be a good buying opportunity but it must be said that the extreme oscillation between bull and bear activity is making it difficult to call. One thing that is coming through is that, in recent trading sessions, once the trend has been established it has (in the main) continued throughout the session.
There is little corporate flow today and no UK economic data so punters will have to watch the trend for direction. This afternoon sees two pieces of less well known US data at 15.00, the ISM Manufacturing and Prices Paid releases, and in a day with a lack of news these may be more important than usual.
The FX markets appear to be reversing the direction of Friday with the dollar weakening again against all the majors as fears over the US economy continue to raise their head. Punters are the right way round on virtually every market as the overriding sentiment is still very Greenback negative but dealers will have to very careful as the hunt for weak dollar shorts may not be quite over just yet. The USD/YEN cross made a spirited attempt to get to the major resistance in the mid 111.00's but seemed to finally run out of steam some way below here at 111.25. The cross rate is now lower this morning at 110.53-110.55 and has traded in a 20 pip range for the last six hours. Look for attempts to shift below 110.45 as this may bring out further sellers and conversely above 110.70 as weak shorts will probably look to cover quickly.
Cable is slightly higher as well at 2.0598-2.0601 but seems to be giving up on the 2.06 level already. There is heavy support at 2.0490 and 2.0410 which are likely to hold us today at least but the trend is beginning to look sterling bearish once more with the crosses going against the pound as well.
Gold is bouncing from Fridays sell off as the dollar weakens. However, as mentioned on Friday, the support at $791 defined the days trading and is now likely to act as resistance. If we fail to close above this mark we may have some tough times ahead. Support is at Fridays lows down at $780.0 and more importantly at $774.0. Having said that, it looks like Financial Spreads punters are still confident and are buying into the weakness.
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Spread Trading, 30 Nov 07
Shorts will be rather miffed this morning as all the info out yesterday would seem to have been negative. From Merve 'the swerve' King's gloomy prognosis to the slightly under par numbers from Dell and, of course, M&B managing to turn a profit into a loss with those nasty little derivatives. It did look like a falling market.
Quotes are up again today after the Far East managed a good performance and the FTSE 100 is called at 6365-6366. That’s up around 15 points. We now look to Europe and the US for the impetuous with a raft of EU inflation and consumer confidence numbers this morning and then the Chicago PMI at 14.45 this afternoon. This has been a very unpredictable month with massive falls, rises, reversals etc etc on an almost daily basis and whilst this is good for trade volumes overall investor confidence gets dented too many times. As we now run into the Christmas trading period we might expect a slowdown. However it must be remembered that the 'non-Christian' financial markets are growing ever larger so we can foresee that even without the input of London and New York markets will probably be just as busy and unpredictable.
The FTSE is now at the top of the 'lower' of the two trading ranges that have dominated the UK for the last year or so. The higher range 6400 to 6775 may prove difficult to get to but the markets do (generally) rally towards the end of the year so bulls will be optimistic. The lower range around 6000 to 6400 has seen the greatest volatility as bulls and bears have battled it out. But, as mentioned, a few days ago the opportunities available down at 6000 have prompted some spectacular rallies as long term investors have sought out value stock.
Marston have come with slightly worse than expected numbers but mainly due to one off costs and the effects of the appalling summer that we experienced. The stock will probably slip in early action but has already had a pretty dire YTD and as mentioned value investors will probably be getting involved at around 300 to 310.
Overnight, in the Sterling / Dollar cross rate, the pound has recovered some of its losses of yesterday after dropping almost 2 cents in the in an almost continuous drift lower. Aside from sentiment it was difficult to pinpoint what was troubling sterling traders. Mr King's comments may have led expectations of lower rates. There is minor support at 2.0605 which, if broken, may tempt further selling down to the medium term trend line below 2.0500. The long term bull trend is currently at around 2.0190 and on pull backs we have seen the market bounce off this.
The dollar has held onto the gains against the Yen but seems to have run out of a bit of Puff above 110.20 so the sellers may be tempted to chance their arm again on the down side. At the current price of 110.16-110.18 it is difficult to get excited either up or down but if we fail to remain on the side of the angels today we can possibly expect to see sellers later in the session before the weekend.
Gold slipped below $800 once more as we show further evidence that buyers above this level are getting just a little cautious. Punters remain very long with us but with the failure to make a new high a few days ago and the swift sell off since will be worrying bulls. A close below $792 will break the short/medium term bull trend and may bring more sellers out of the wood work. With the gold spread currently at $794.3-$794.8 we are not far away.
Brent Crude Oil seems to be having a merry old battle around the $90-$92 level as we oscillate about driven by supply and fear. There appears to be enough of the black stuff about but this is not causing the price to fall as traders and end users strive to ensure supply over the winter and spring. We have definitely broken the upward momentum trend but it remains to be seen whether this will turned into an outright bear move or whether we will drift sideways until a new momentum is achieved. The January Brent spread is $90.28-$90.33, up about 20 cents overnight. Traders will be watching for the lows of two days ago at $89.50 to be attacked or for a retracement up to yesterdays opening highs above $92.00. It is very difficult to form an opinion in the current environment (other than tossing a coin).
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Spread Trading, 29 Nov 07
The FTSE has fallen from its highs this morning. It started today's trading session higher following a big rally in the US last night. However it doesn't look like the FTSE will be able to avoid posting its worst November in history. Currently over 6% lower for the month, this has not been the best of times for investors and there has been a great deal of talk about "flight to safety" with the utility and pharmaceutical sectors performing better than most. Clients remain bearish however, largely sellers of the FTSE expecting tougher times ahead as the year draws to a close. Despite the positive news from the likes of Alliance & Leicester this morning and upbeat news from John Lewis earlier this week, financial stocks have continued to be a burden on the indices. This will not be a month that investors will wish to remember and they can only hope that their fortunes will turn around in the run up to Christmas.
Nationwide house price data has come in lower than expected and as a result sterling has taken a bit of a hit. The first monthly fall reported since February 2006, reverses the surprise October gain of 1.1%. The annual rate is now down to 6.9%, the lowest since Aug 2006. Sterling has once again retreated from 2.0700 in an aggressive move lower but the overall trend appears to remain in tact, at least this is what clients seem to think overall, believing that today's move lower is a buying opportunity.
At the time of writing US futures are pointing to a lower start this afternoon and we are calling Wall Street to open around 40 points lower at 13250. 13h30 and 15h00 London time sees GDP, personal consumption and housing figures released in the US. It's one thing to hint at possible rate cuts next year, but another to say that the breadth and depth of the credit crunch could cause much slower growth than expected next year.
Oil is $2.5 higher this morning after it's big drop yesterday, shaking out some of the bulls. Some technical analysts are suggesting a double top has formed, which is usually a bearish signal, as well as the elusive $100 mark offering quite a degree of resistance. However, that may not be the case today.
Spread Trading, 28 Nov 07
The Citygroup cash injection has been done to death by now so I will refrain from adding my two pennies worth. Other than to say that it is an indication of where world liquidity now resides, ie when this type of refinancing must go outside of the US for success.
Equity markets are very jittery this morning and although they are trading pretty much unchanged with the FTSE spread at 6138-6139 after the first hour we are seeing very sharp shifts on a moments notice. 10 - 15 pip moves every few minutes. Dealers are getting in and out very quickly as the temptation to take any quick profit kicks in. In this environment the probability increases towards a sharp shift lower as investors decline to take on new risk. The fear will increase that if there is any large surplus of unsold stock that stock price could subside.
On the plus side is the undoubted value that is now presenting itself. Banks always loath to lower dividends and yields on most of the majors are now well above 6% and threatening on dips to go above 7%. With rates at 5.75% and at the moment unlikely to go higher this makes long term value almost a certainty, it is just the short term worry that is holding the big boys back. Plus, of course, the fact that they are probably already holding large portfolios of banking sector equities and all very much under water. And as mentioned yesterday any print in the 6000's does seem to bring out the buyers.
Punters are now in two minds. We’re seeing buying of the FTSE and European indices whilst sellers are much more noticeable in the US markets. This is obviously a natural factor of the physical location of most of our clients but it does give a general indication of the perceived fear for the US economy over the European.
Anglo Irish have defied all the fears over the current financial market and have beaten previous estimates. They’re now forecasting another 15% rise for this year. This rather asks the question as to why the shares have dropped 40% this year and (if we do not go back up to the highs) why they were up there in the first place. The stock is up 4% this morning at 10.35-10.41 but this seems rather a muted reaction to the numbers. At least we are 20% above the lows of last week.
On the FX front the dollar has returned to the trenches and is putting up a spirited resistance.
The Yen / US Dollar cross has managed a return to 109 after pre US trade yesterday saw Europe trying to force it lower before the Yanks came in on the buy side. As mentioned yesterday, weak Dollar bears are being hunted and shot but this should not detract from the fact that the greenback is on a downward trend. There appears to be some resistance just above 109.00 versus the yen and we are seeing renewed selling here but on any close above 109.10 we may see a push to take out more soft sellers.
The pound is struggling to hold onto the small gains made yesterday and is now off 85 pips against the dollar at 2.0604-2.0607. There is not actually much to go for at this level. This price in the past has been seen as a point on the way to somewhere else. The bears will be looking for a return to the trend line at around 2.0450. The Bulls will be hoping that this is not a move (as mentioned) on the way to a lower price. The pound seems to struggle above 2.07 and we have seen several attempts over the past week to break into a high range but all have been defeated. Punters (as ever) should be wary of sudden shifts here as confidence seems to be slipping.
With the Dollar moving higher, oh what a surprise, down comes Gold. This time punters have been caught out as the temptation to buy on any slip has been too much for many. We saw heavy bet buying yesterday morning at between $816 and $822 after the quick fall from the $837 level. As mentioned in yesterdays comment the technical analysts would have been looking at the candlestick formation as a possible sell indication and on this occasion the premise has panned out. The gold spread is now $794.2 - $794.7 down some 20 bucks. A close below $780 would put the cat amongst the pigeons as it might indicate a double top. But there is a good chance of a bounce from the support level at $789.0
Crude Oil, as with Gold, has hit a sudden reverse with OPEC announcing a higher production level to help ease emerging market requirements. At the moment the 100 buck level is still elusive but the pull back is still not terminal as both Brent and Nymex are still in the 90's. Brent is bouncing from overnight lows and is now up just a tad at $92.71 - $92.76 and our clients will be hoping for a good move higher as buyers were being severely damaged in yesterday's move.
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Spread Trading, 27 Nov 07
So, these days it isn't the US cavalry that comes to the rescue it is the Abu Dhabi Investment Authority.
After a truly appalling day on the markets the Middle Eastern saviours are either getting in at the bottom or catching a falling knife. The cost to Citigroup for the cash injection seems to be quite extreme. Selling securities that possibly pay a yield of some 11% compares to US Government 2 year yields of sub 3% an 8%, plus premium. The company has obviously run into rather a bigger capital adequacy problem than was first thought and this should put it back into line. The difficulty now is that the bank will increasingly be seen as an Oil owned institution which may not go down too well in its US heartland.
That being said the reaction this morning is rather heartwarming (especially for Capital Spreads clients who were sitting on some very nasty longs at the close last night) with the Dow being called over 100 points up from the close and the FTSE 'only' 40 off at 6138-6139 after closing in after hours action down at 6090.
There is solid support in the 6000's from where (aside from one trading spike in the August fallout) we have bounced quite strongly on many occasions. Whether investors will cling on this time remains to be seen but the repeated failures seem to be beginning to worry buyers. We are not seeing quite so much 'bottom picking' this morning,
Virgin Money seems to be the blue eyed boy as far as the Treasury is concerned and if they can buy the company for what is the reported bid then a few people are going to become a great deal richer in a very short period of time. With no real bad debt problem the 'new' owners only need to secure the money market liquidity to turn the whole ship around which on a risk/reward basis is rather a better bet than buying into Citigroup at the moment. Existing share holders are understandably a bit miffed and the Governments avowed dislike of 'Private Equity' seems to fade away when the Chancellor is having his n*ts pulled out of the fire. Somehow the magic of Branson disguises the fact that this is a venture capital takeover in all but name and they are not even risking a great deal of their own money as the deal rather relies on a biggish equity issue going ahead. This is one 'teenage scribbler' who would like a bit of the Virgin angel dust to settle around here!
Barclays have reiterated their forecast for the year which has bolstered the stock. However to balance the scales HSBC has announced a hefty $35billion injection to two of its investment vehicles to stop any firesale of assets. At the moment, all the big houses are propping up units and that prevents the proper revaluation of many assets given that they are never put on to the market to assess their real value. In a world of no buyers it is best not to be trying to sell. Rather like the art world in reverse where it is in the interests for virtually any work to go to ever higher levels in auctions as this then ups the value of everyone's holdings. If a BottoChavagVinci goes for £20m then 'of course' all BottoChavagVinci suddenly attain this worth.
The problem for the banking sector is not really what is going to happen this year but what all these problems will do to next year’s growth.
The FX markets are having one of those reversal days with the Yen taking a pounding across the board and even the Euro giving up a bit of ground as dollar shorts get squeezed. The vote of faith in not just Citigroup but by association the dollar as well from one of the OPEC members has given the hard pressed buck something to cheer about.
With the Dollar now above 108 again against the Yen we are seeing some small buying from punters looking for follow through but it must be said that if it takes a $7.5 billion cash move to just regain one cent then the momentum is probably still on the downside. For today though there is the distinct whiff of a bear hunt going on as weak dollar shorts are flattened in the rebound. The problem in much of this is that the cost of carry on a losing position is quite difficult to take. 107.00 was a cusp point for 2004/2005 and can now be considered as good support so a bounce from here is not unreasonable, especially as we have fallen so far already in just a few weeks. Ten cent falls are not usual for the dollar even these days and over the past five years have generally been seen as blow out moves which have formed solid bases. Bears have had a good run but it is always dangerous to assume that the market will be forever favorable.
Gold had an odd trading day yesterday rallying up to $837 before coming back down to close almost unchanged which is where we open today. The charts are now showing three spike failures to the upside which will be giving some worries to punters and the formation on the candlesticks (as mentioned a couple of weeks ago) may bring the technical sellers out to play. That said, any sell off will be fighting against the continued bull run and it would take quite a change in perception for the bears to gain control.
Crude Oil slipped yesterday and is still below $100 as the fabled land remains just out of reach. Producer selling is likely to be quite heavy at this level especially as OPEC is rumoured to be increasing production. However with so much pressure on the up side it is difficult to bet against a spike up to the mark at some time. We would all feel very let down if the Oil price now drifted back into the $70's or $60's without just one print at the triple digit!
Spread Trading, 26 Nov 07
A positive start to the week after a long week-end in the US and even though the FTSE didn't get down to quite hit the 6000 level, buyers have been attracted back into the market.
It’s not just the equities market that’s found buyers, Gold is up $25, (up 3%) following on from a big rally in the Asian session.
As a result it is the miners leading the way this morning and a few retailers also doing well after reports from high street stalwart John Lewis that they saw a 10% rise in sales week-on-week and year-on-year for last week. It's an important time for year for retailers and judging by how late shoppers were out until last night it's no wonder Capital Spreads clients are favouring the likes of Marks & Spencer over the banking sector.
Thanksgiving shoppers in the US also seemed to shrug off any worries they may have over their house or credit situation by hitting the shops hard. Online sales are expected to smash all records this year once again and it looks like credit cards could once again be stretched to their limits.
The question on many people's lips is "could this be the turning point to test year highs for the equity markets?" As we near the final month of the year, the vast majority of investors will be happy to see the back of a very rocky month. December is historically a good month for equities and clients are already positioning themselves for a run higher in equity prices as 2007 draws to a close.
The week starts slowly for economic data and company reporting, with a build up of US economic data towards the end of the week. Note that consumer confidence figures are released tomorrow, which could prove to be a very important set of numbers.
Northern Rock has taken another bashing this morning after Virgin group was revealed to be the preferred life ring for the company. Even though savers deposits have been guaranteed by the government, investors are still uncertain as to whether they will see any sort of return.
Gold's rally overnight has been fuelled by the speculators trying to tip Crude Oil over $100 a barrel as the dollar continues to remain out of favour. With just over a dollar to go for oil to hit the elusive $100 dollar mark, few are betting against it doing so in the short term.
For the latest spread trading update from Simon Denham click here.
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Risk Warning: Spread betting and CFD trading carry a high level of risk to your capital and you may lose more than your initial investment. Spread betting and CFD trading may not be suitable for all investors. Only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved and seek independent financial advice where necessary.
'Spread Betting Futures Trading' by DB, updated 07-Dec-07
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Markets are open on the up this morning with heavy buying towards the end of the US session on Friday and the Far East joining in on the action this morning. The solidity of the markets in the face of poor economic data is giving weight to...read article: To Trade or Not To Trade.
Housing Market v FTSE 100 Performance, updated 12-Dec-08
Today is the last serious trading day of the year as the next two weeks tend to be very, very short on liquidity and occasionally long on volatility. In the UK there is now another variable to be taken into consideration and this is...read article: Housing Market v FTSE 100 Performance.
A Courageous Decision on Market Turmoil, updated 02-Dec-08
Just when you thought it was safe to go back into the water the Dow drops 680 points in a session. The more you watch the various twists and turns of...read article: A Courageous Decision on Market Turmoil.
The Banks and Lending to Business, updated 01-Dec-08
With another 12 months of a, probably, contracting economy, I would look with a pretty jaundiced eye at a small business that required money to survive right at the beginning of the down turn. I might ask 'when times...read article: The Banks and Lending to Business.
The Pre-Budget Report and the FTSE 100, updated 25-Nov-08
The FTSE is called virtually unchanged as traders try to get a handle on Chancellor Darling's stimulus package but the reality is that our markets are...read article: The Pre-Budget Report and the FTSE 100.
VAT Budget Cuts and the UK Economy, updated 24-Nov-08
The madness of an ever greater public sector funded, in an ever increasing proportion, by a booming service sector at the expense of a weakening manufacturing division had been pointed out ad-nauseam by various commentators over the past ten years. The huge tax revenues created by...read article: VAT Budget Cuts and the UK Economy.
High UK Interest Rate Problems, updated 14-Nov-08
The Sterling / Euro spread is now at €1.1649 - €1.1653. That means that against our major trading partner, whose currency has also dropped alarmingly, we are over 20%...read article: High UK Interest Rate Problems.
July Spread Trading Hours, updated 04-Jul-08
July Trading Hours, make sure you don't get caught out with the changes to trading hours on Thursday 3 and Friday 4 July...read article: July Spread Trading Hours.
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