Another week has flown past so here’s my FTSE 100 Analysis for the weekending 11th May. Another turbulent week what has seen the 20 day EMA just about to cross the 200 day EMA. While this really proves nothing it suggests that the downward move may continue. The new downward move has seen a new recent low setting the scene perfectly for a down trend. I would think the downward move will continue but I have no idea how far or deep it will go. I suspect it will heavily depend on the news events that emerge over the coming weeks. The main thing to watch out for is set to be the whole situation in Greece. If they fail to form a coalition or is the coalition abandons the austerity measures offered by the EU then they will be getting no more bailout money. Personally I don’t blame the EU for taking a hard stance in this as it’s the only way to send a message that the behaviour that caused the mess in Greece will not be tolerated. If Greece then leave the Euro the danger is it sparks a cascading affect and others may also default and exit t the single currency.

Anyway back to the FTSE 100 Analysis. With the EMAs in no clear trending pattern there is no confirmation of the down trend that the price movements have been suggesting. Therefore it’s still not time to only look for down trending stocks so I’ll look for trends in either direction. I probably will not be looking for any new trades this week as I go on holiday at the end of next week and I don’t want to have any trades open while I’m away. It also means that this will be my last weekly FTSE analysis for a while but I’ll get back into it when I return on the 3rd June.

Outlook for the week ahead is bearish.

Today has seen a flurry of spread betting activity from me.(Compared to usual standards at least). I’ve seen a few positions stop out. I’ve trailed a few stops and I’ve also closed out a position manually.

First onto the stop outs. Debenhams stopped out yesterday at 76 giving a loss of around £10. Hardly surprising since the BBC news reports ‘Wettest April hits retail sales’. The stock was doing ok and looked to be returning to the up trend until a couple of days ago when price dropped dramatically. It then continued to drop and hit my stop at 76. It could well be the case that this a retracement of the previous bigger move but I’m not interested in finding out. I’ve been stopped out so it’s time to move on. Interestingly this was the position that I split in my Capital Spreads Vs SpreadCo trial. You’ll be glad to hear that both of my stop prices were met and the positions closed out at the same time almost to the second.

Spirent also stopped out today as the FTSE 100 continues to fall. The position closed at 158 giving a £20 loss. This also looked like it may return to the up trend but then the falls of the last three trading days kicked in and Spirent fell in sympathy with the rest of the market. I have to say I am not confident at all about the state of the FTSE 100 at the moment. My weekly FTSE analysis has indicated that a new down trend could be forming, are we witnessing the start of it?

I closed my position in Dixons today. After looking at the chart this has really failed to return to any up trend that may have been in place. This always was a stock that I need to keep a close eye on and I would exit if I felt it was not performing as planned. So that’s what I did. I closed out for a £0.5 profit, better than a loss. So this was a scratched trade. Another reason for closing this position now is the fact that I am off on holiday at the end of next week and I will not be able to monitor trades while I’m away. I will most likely close out all of my positions before I go so I can safely relax and enjoy my time off without the worry of open spread bets that could go against me.

Finally I trailed stops in my remaining open positions. Enterprise inns is proving to be my star performer at the moment and is currently showing around a £40 profit. It’s also fallen back a bit today in sympathy with the rest of the market. If it falls back a bit more I may look to pyramid again and buy the dip. Avocet mining is coming along nicely, the last few days of falls have taken it with it and it has returned to the down trend which was the reason for going short in the first place. First group is in no mans land at the moment. It currently can’t decide what to do. You would’ve thought with the recent falls in the FTSE it would’ve also fell but no. I’ll keep my eye on it for the next couple of days but if it’s got nowhere by Friday I’ll exit no matter what.

Right that’s all from me to today. Keep an eye out for my FTSE 100 analysis at the weekend.

Until next time,
“May the markets be with you!”
Harry,
The Spread Betting Beginner

It’s that time of the week again so here’s my FTSE 100 analysis and overview of what might happen in the week ahead. The downward move that ended on 11th April at a low of 5576 could be tested in the week ahead. This downward move was has retraced back to around 5820 before falling dramatically on Friday. The fall has a ways to go before breaching the April 11th low but if it does I would expect the fall to continue to around 5400 before finding support. The 20, 50 and 200 day EMAs don’t confirm anything at the moment except that there is no trend in place at the moment.

Daily FTSE 100 Chart 5-May-12

If we take a look at the weekly version of the FTSE 100 chart we can see that the start of a new down trend could be forming. We hit a new low three weeks ago after four weeks of consecutive falls. Since then we’ve had two weeks of gains retracing some of the previous falls and this week has seen a dramatic fall back to around the closing price of the most recent lowest week. For the down trend to be confirmed on the weekly chart price needs to fall below the most recent low. With the state of the markets at the moment I think we could see this downtrend forming an continuing.

Weekly FTSE 100 Chart 5-May-12

Going back to the daily chart there could be a potential head and shoulders chart pattern forming which can be the sign of a reversal. However with no clear signal either way anything goes from a trade direction stand point. Will a down trend emerge over the coming weeks, well that remains to be seen, and as always anything can and will happen.

Watching stocks and waiting for the right time to enter is the key to successful spread betting(at least that’s my opinion anyway). In the past I have fallen foul to rushing in but there really is no need. When you find a trade that meets your strategy criteria, unless you have entry signals included in your strategy then it doesn’t always mean you should enter right away. For example, I’ve recently switched back to finding trends and trading them. (In my view I think it one of the only ways to make any money spread betting and so far it seems like it might be paying off). Anyway back to the topic at hand, I rushed the last few trades I made when I should’ve watched them for a few days to see what happened. When using a trend following strategy it’s all well and good finding a stock that is trending well but if you enter at the wrong time then you may as well just pick a stock at random and flip a coin.

A good trending stock will have a series of higher highs and higher lows for an uptrend(reverse for a down trend) and so it’s best to wait until the stock hits a new higher high, falls back a little and then enter. This is a very common strategy know as buying dips and Malcolm Pryor has some excellent ways to achieve buying dips in his enormously popular financial spread betting handbook. If you don’t have a copy I suggest you get one and read it cover to cover. It’s one of the first spread betting books I ever read and I always seem to end up coming back to it.

So back to the point of todays topic. I had a look yesterday for some new trades and there are a few stocks that are trending nicely and are most certainly potential trades. I was tempted to rush in and just buy each of them straight away but I managed to hold myself back and wait for the dips in price. Then I’ll look to enter with a fairly close stop in case things don’t go to plan. The biggest issue I have is how to know when price has dipped enough. The honest answer is there is no way of knowing when price has dropped back enough and I’m using a bit of gut instinct here that I seem to have developed over my three years of on again off again spread betting. Hopefully my gut is helping me out and before too long it will just be on again spread betting but we’ll wait and see on that front. I am starting to feel a little more confident in my own abilities as a trader but if there’s on thing I know for sure it’s a little confidence can turn in to a big disaster. Get overconfident and cocky, thinking you can’t go wrong, and believe me you could lose the shirt off your back in the blink of an eye. Best for now to keep thinking I’m no good at spread betting.

The new trades that I found yesterday are on my watch list and I will keep an eye on price over the next few days. If and when feel the time is right I’ll look to enter. If that time never comes then so be it, there’s always tomorrows trades.

Until next time,
“May the markets be with you!”
Harry,
The Spread Betting Beginner

Well here it s my eagerly awaited FTSE 100 weekly analysis. I didn’t get half as much time to do the things I wanted this weekend so those that are awaiting my updated spread bets list will have to wait just that little while longer. I’m hoping to get to it at some point this week but never say never.

Anyway onto the FTSE 100 analysis. Well it’s been another choppy week and when the markets dropped on Monday I thought the down trend was about to be confirmed but ever since then we’ve had a few days of rises. The 20, 50 & 200 day EMAs are all level with the 20 below the 50 but above the 200 so these tell us that there is no clear trend in the market at the moment. The way the chart looks at the moment it could go either way up or down so I will be looking for either long or short trades again this week, if I get the time that is.

For the people who are into pattern spotting it looks like there is a symmetrical triangle pattern in progress, but as for what that means I have no idea. I guess I need to do some more research in to price patterns. When I get some time I’ll look into them and add a new section to the technical analysis section so keep an eye out for that.

Well that’s it for this week, short and sweet. My outlook for the market is mixed which isn’t much use if you plan on trading the FTSE. Maybe next week will be different.