Hi Sam,
the market at times is moved to extremes by "strong hands" you usually see this during periods of low volume and we have had low volumes the last few days on the futures and cash in the FTSE.. they are effectively ensuring that price gets to an area that they can then sell at a large profit to the unsuspecting public who now believe that everthing is rosy... BUT it can also be moved if the market (and central banks) believe that there is too much shorting of the market and they want to reduce the volatility..so they push price up.. this can be seen very clearly in the order book where even though large orders are selling .. price keeps moving up.. they do this by soaking up the sell order with a buy order and then removing many OFFER orders further up the price, so that the market then jumps up to the next tradeable sell order.. this spooks out the shorter who then has to cancel by buying back the position and hence adding to the general move upwards. You also see many fake outs on the short side,,, making price look weak only to then push it up.. so lots of physchological games that messes with the short term traders mind...
I will post levels in a seperate thread for today later.. in terms of direction... all I can say is watch the levels and trade what you see on longer term charts (say 15/30/60mins) to avoid the noise and reduce position size until you can see the wood for the trees.. when it turns they will not make it easy.. just when it seems easy to get in and make money from longs they will turn it round again.
In terms of general direction.. this is a short squeeze.. and the DOW cash hit its 200 day ema last night and the Euro has retraced 50%... so maybe this is it.. my worry is that the German Bund (which trades inversely to equities) has broken down though a head and shoulders topping pattern.. it maybe that Bonds have had there day for a while and big money now ploughs into equities .. Interesting times.
