Spread Betting Trader
|
|
 |
A full-time spread betting trader talks through the highs and lows of the markets, supplied and sponsored by paddypowertrader.
Spread Betting Diary - 17 Feb 2009
Business as usual. The equity bears are having a picnic; the S+P 500 is currently below 800 and gold has plugged $1,000 into its Sat Nav.
My only trades today have been in GBP/USD; the first trade was wasn't my finest and cost me a few quid, the second was better and left me in the black for the day.
I’d hoped to get to the gym before the release of the UK’s inflation data, but for some daft reason decided to open a trade first. I reckoned that the overnight news on European banks, and the knock-on weakness in equity markets, would benefit the Dollar. The GBP/USD rate was way below its pivot point and falling. I would have preferred to sell on a pullback, but early-morning fever took over and I dipped my toe in with a £1 sale at $1.4136.
The only thing that happened for the next hour and a half was that I ended up not going to the gym. The price stuttered close to my opening level, not inclined to return to the lower levels ahead of the inflation announcement. In fact the steady improvement ahead of the number looked suspiciously like a few people knew what was coming. I opted to hold the bet over the announcement (only because it was a tiddly £1 bet) and closed out at $1.4178 on the higher than expected inflation figure. The loss of £42 was an annoyance, but at least it was a tolerable one.
My second trade was a much better shout, and improved my mood no end.
Moving Average Crossover
One of my spread betting acquaintances talks about using a moving average crossover to enter the trade; this usually means that you don’t get the full 3-course meal, but that you’re more likely to enjoy a good main course, rather than get chucked out during your starter. I tend to trade when the price crosses a moving average, rather than wait for a moving average crossover, but only if the move is confirmed by either a MACD or RSI momentum indicator.
Don’t get me wrong; I’m not saying my way is any better (it’s certainly more risky). I’m simply using it as another example of the many variations on a theme. If you were to look at a candlestick chart of the trade you would see the two entry points; the first where I entered after a closing candle on the price crossover, the second after a closing candle on the moving average crossover. But that’s a selective (though topical) chart. Many other charts would show my early entry stopped out as the momentum dies.
So, back to my trade, I bought £2 at $1.4222 and, after trailing my stop at a safe distance, closed the trade at $1.4295 after the second assault on $1.43 failed. The trade netted me £146; enough to offset my earlier loss and pay for some tuna sandwiches.
FTSE Short
However, forex trading was a sideshow today. My real winner was an extremely patient short bet on FTSE, and I must admit to closing out part of the short at 3998.
Previously there was good support around here and I reckon I’ll get the chance to re-open at a higher level in the next few days.
The real fun will begin if the S+P 500 ends the week below 800. With option expiry on Friday I’m hearing there will be a lot of support around this level. I'll believe it when I see it.
A final observation; gold looks to be the safe haven of choice, rather than the Dollar or Yen.
Happy Trading
The above content does not constitute investment advice.
Neither CleanFinancial.com nor paddypowertrader accepts any responsibility for any use that may be made of the above or for the correctness or accuracy of the information provided.
Our Hero, FT, is a full-time trader, with nothing but two kids to distract him. 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.
|
Financial Spreads
"With FinancialSpreads.com you get all the normal
advantages of Spread Betting plus commission free trading on 2,000+ markets, 24 hour trading and..." read
Financial Spreads review.
|
Spread Betting Diary - 11 Feb 2009 - Part 1
Sterling’s continues its seemingly irreparable slide as Bank of England governor, Swervyn Mervyn King warned that the UK was in “deep recession”. . This speech will be rejigged and delivered by Monsieur Trichet in the near future.
Today (11.02.09), I've blown some of my winnings to show newbies the difference between a strategic and an impulse trade.
Trade 1 - Impulse
In truth, I didn't exactly perform this thread while completely blindfolded. I’m already a small short in Lloyds and thought it would be likely to suffer if the bears kicked off again. After the recent relief rally a small downturn looked to be coming into play and the shorter moving averages had crossed below the 50-MAV on the hourly chart.
Lloyds shares dip below 100p
At the time of writing, this one is moving well under its own power, but here’s the crazy bit; I made my decision and acted straight away, selling £5 at 87.6p - fine if I’m running a large portfolio and making a long term move, but as a trader it was daft; I sold just after the shares were marked down and spent the morning with an irritating red blot on my trading book. I’m relaxed about the trade, but could, and should, have got better terms by using the charts.
Trade 2 - Strategic
Yesterday I was running a short bet on EURGBP, but it was starting to look like the tide was turning. I set a disciplined stop at £0.8805, which was taken out whilst I was being treated to lunch. A nuisance, but trading can be a full-time job, and I was damned glad of that stop as the price pushed onwards towards £0.89.
EuroSterling rallies back above £0.90
I'm not the Euro's biggest fan, and I’m not entirely certain why it’s doing so well, but the charts favoured it so I've looked to trade EURGBP on the long side. The overnight move had added 100 pips so I really wanted a pullback before jumping onboard. Early trade refused to give an inch so I used the break above the day’s high as a trigger.
Trading the breakout without a pullback is a riskier trade, but often there’s money to be made if you’re alert. I’m also far quicker in shutting the trade down if I don’t think the momentum’s there. I paid £0.8973 for a fiver, selling £3 at £0.8983 and a further £1 at £0.8998. Then, after reaching £0.9029 the price tailed off, hitting my stop at £0.8983.
A decent pullback gave me the chance to re-enter the trade, although I sacrificed a larger gain by opting to wait for confirmation from my signals. I paid £0.8963 for a fiver, taking profits at £0.8975 and finally £0.9003 when, again, support above the big figure diminished. The profits were steady rather, rather than exciting, but the trade had a plan and it worked.
Happy Trading
The above content does not constitute investment advice.
Neither CleanFinancial.com nor paddypowertrader accepts any responsibility for any use that may be made of the above or for the correctness or accuracy of the information provided.
Our Hero, FT, is a full-time trader, with nothing but two kids to distract him. 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.
|
Financial Spreads
"With FinancialSpreads.com you get all the normal
advantages of Spread Betting plus commission free trading on 2,000+ markets, 24 hour trading and..." read
Financial Spreads review.
|
Spread Betting Diary - 11 Feb 2009 - Part 2
Usually I'm bearish on equities (sometimes too bearish), but I’m not getting too carried away after yesterday’s move. Sure, it was good to see a sell-off, but really it wasn’t up to much. Prices are no-where near testing the uptrend line from November’s low, and today’s seen a bounce off the 21-day moving average. I added to my short bet last night, but closed out for a small gain ahead of the US close.
FTSE falls but still in uptrend.
For those of you still confused by what the US stimulus package is all about:
This year, US taxpayers will receive an Economic Stimulus Payment. This is a very exciting new program that I will explain using the Q and A format:
Q. What is an Economic Stimulus Payment?
A. It is money that the federal government will send to taxpayers.
Q. Where will the government get this money?
A. From taxpayers.
Q. So the government is giving me back my own money?
A. A fraction of it, yeah.
Q. What is the purpose of this payment?
A. The plan is that you will use the money to purchase a high-definition TV set, thus stimulating the economy.
Q. But isn’t that stimulating the economy of China?
A. Shut up.
Below is some helpful advice on how to best help the U.S. economy by spending your stimulus check wisely:
- If you spend that money at Wal-Mart, all the money will go to China.
- If you spend it on gasoline it will go to the Arabs.
- If you purchase a computer it will go to India.
- If you purchase fruit and vegetables it will go to Mexico, Honduras, and Guatemala (unless you buy organic).
- If you buy a car it will go to Japan.
- If you purchase useless crap it will go to Taiwan.
And none of it will help the American economy.
That money is needed in America. It can only be kept in America by spending it at yard sales, going to a baseball game, or spend it on beer and wine (domestic ONLY), funerals, weddings, or tattoos, since those are the only businesses still in the US.
Happy Trading
The above content does not constitute investment advice.
Neither CleanFinancial.com nor paddypowertrader accepts any responsibility for any use that may be made of the above or for the correctness or accuracy of the information provided.
Our Hero, FT, is a full-time trader, with nothing but two kids to distract him. 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.
|
Financial Spreads
"With FinancialSpreads.com you get all the normal
advantages of Spread Betting plus commission free trading on 2,000+ markets, 24 hour trading and..." read
Financial Spreads review.
|
Risk Warning: Spread betting carries a high level of risk to your capital. You may lose more than your initial investment. It 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 Trader' by FT, updated 17-Feb-09
For related pages also see:
Spread Betting Diary, updated 27-Feb-09
Spread Betting Diary: A full-time spread betting trader talks through the highs and lows of the markets...read article: Spread Betting Diary.
Spread Betting Trader, updated 17-Feb-09
Spread Betting Trader: A Day Trader runs us through his view of the financial markets...read article: Spread Betting Trader.
|
|
Q) Average Trading Results?
A) Get free spread betting tips, offers, price updates, important news and more!
|
|
