FTSE and the DOW


Legendary member
In my experience, as soon as the good old US of A opens its doors in the mornings, the FTSE asks how high and obeys like Blair to Bush. Consequently, as soon as it does open, I feel all I am doing is trading the DOW via the FTSE so the same, just a bit smaller...

What is the point of trading the FTSE in the afternoons? What is the point of the FTSE with its 100 companies if as soon as America opens, all UK relevance becomes well, irrelevant and it just follows the DOW.

Do people factor this in to their trading? Does it all tie in correctly anyhow? Does anything here (UK) matter or does the chart lead and the US input is to be expected, ie a big ole triangle will fulfill its criteria because of the DOW, or can what looks like should be an (insert a setup here) become pointless the following morning because America has dragged the FTSE off in another direction therefore ruining said setup?

Anyhow, my point, ah yes... Why trade the FTSE or expect it do anything and can the FTSE really be treated and traded as an independant market? :confused:

fat chance

And in the morning, it seems like the FTSE just follows the DAX / EuroSTOXX (just a bit smoother). I have been wondering about the relationship between the DOW, FTSE and DAX too - why are they so highly correlated? Different companies, different sector weightings, different countries making different announcements about economic policy... it all makes no difference. Every evening you get reports along the lines of "the FTSE was led higher today by such and such companies / strong performance in the whatever sector, following reports of this and that / better than expected results from thingy / a rise in the price of something". No, it just tracked the DAX point for point, and the DAX followed the DOW / S&P. I guess there has to be some correlation between them because of global trade, global inflation, trading foreign currency etc, but almost tick for tick?


Established member
Yes, the FTSE does follow the US markets to a large degree, but that's the markets world wide.

You ask, "What is the point of trading the FTSE in the afternoons."

Well, there is one major difference, which springs from the top of my balding head, there is a two point spread on the FTSE as opposed to the four and five point spread on the US markets [depending on which SB company].

The FTSE's direction is not, as some would dither, a mirror image of the US markets movement, it's more a reflection in a muddy pool. And sometimes, the pebbles of economic data and company results may cause ripples as to distort the clarity even further.

"Why trade the FTSE?" Because It's a challenge. It's OUR market. It may have its head turned daily by the US equivalents, but IT IS predictable.

Good trading