FTSE100 July 2004

[mully]

Welcome everyone to a new month.

Officially we are now in an era of "measured" US interest rate rises.

Yesterday's Fed announcement appeared to meet the market's expectations.

But remember it is actually future data releases that will dictate the actual scope and speed of further US rate rises.

I have included my monthly summary of Global statistics, with a year to date update.

Basically, tboth the dollar and global equities are up 2.6%

It highlights the lack of any progress for the FTSE100 so far this year (-0.3%).

US bond yields are 34bps higher and Crude oil is 14% higher.

And who said making money trading was easy.

Best of luck everyone and keep up the posts.

 

[Fluke]

Mully
Thanks for continuing the threads,it must be hard work some times,but we do appreciate your efforts on this.
lol
regards Jon

 

[mully]

As an example of data releases, we have the latest US non-farm payroll numbers on Friday.

However, any reaction may be deferred owing to US independence Day holiday on Monday.

 

[mully]

Here comes the test of yesterday's lows. Let's hope the test is successful(Bracke)

 

[peterpr]

I'm not a US market expert by any means (neither come to that a UK one) but from necessity born of some experience I do follow a number of US commentators quite closely. I had a rueful chuckle at one this morning. Given the awe with which we've all been waiting for yesterdays iterest rate decision and commentary I though this might provide some light relief. A take on the US Federal Reserve - aka Big Al's machinations in US election year:

"Watching the Fed is like playing defence against a basketball superstar - focus on his mid-section and don't get faked out by flailing arms, trash talk and happy feet"

That's from Robert McHugh of Mainline Investors at: http://www.technicalindicatorindex.com/sampleissues.aspx

 

[splasher]

I've got to admit this market is a struggle at the moment. I try and trade in two styles, my preference is swing trading but with the poor ranges at present the profits are few and far between so i am, forced to job the market for a few ticks, much more stressful as it involves watching the screen closely and a 5 point movement suddenly seems like a major move as opposed to swing trading when i virtually ignore it.

As we are a good and honest board, how are you chaps faring?
Making? Losing? Doing nothing?

I'm up small as i can generally make a few bob each day to keep the wolf from the door but any sudden moves wipe out a days profit and it makes me less inclined to punt overnight when i have worked hard all day for my profits, eg yesterday i was pretty sure 4465 was a good buy in futures but left it alone........DOH.

I know some here will not be jobbing as using spreads but interested in how you are all doing

Splash

 

[KJH]

.......As we are a good and honest board, how are you chaps faring?
Making? Losing? Doing nothing?.........

Splash

Hi Splash,
Was short yesterday but closed out at 4495ish....dumb eh !

I'm also feeling -- well I'm not sure what yet but something is amiss--probably just geting impatient---my biggest enemy.
Maybe next week when the Americans have recovered from their holiday the true trend will evolve.
This market (FTSE) really seems to be struggling to the upside. Not just today but every day for weeks.
June 28 was and exception and a 1 day wonder....
Broke to the upside of the sideways consolidation / overhead resistance -- looked real scary for any one short ( as do blow off / capitualtion type moves--up or down) and yesterday took me by surprise.

Does anyone know where I can get more reliable daily ADv /Dec specifically on the FTSE100 components ?

We had a little discussion going the other day on volume -eod.
I get EOD Volume from
http://uk.table.finance.yahoo.com/k?s=^ftse&g=d
The big move up on 28/06 was an outside reversal day up with a range of 56 odd points and a volume on the abovementioned web site of 1.565...
The next day , an inside day with a range of 26 point s and Volume of 1.564... Normal consolidation after the big day up.
Now yesterday was 49 or so point range day, Volume 1.924...
Any one shed any interpretion on this for me ?
To my mind the volume ( pressure) is to the downside......
The volume from the previous 2 good down days--June 22= 1.703... June 14 = 1.022
Heaps more yesterday than June 14 swing low.....
Does this mean a swing low might be in place or that if it is broken we are going to test the downside towards 4400 or lower......?
Thoughts/ comments ? ( anyone !)
KJH

 

[KJH]

Hey Spasher,
I see we are on a par with number of posts....
But where did you get all the "stars" from ? !!!!!!
kjh

 

[KJH]

That's from Robert McHugh of Mainline Investors at: http://www.technicalindicatorindex.com/sampleissues.aspx

Peterpr,
Scary reading !
kjh

 

[mully]

Sorry if I sound like a broken record and my preference for the FTSE250
for identifying UK equity trends. But..


The problem with the FTSE100 as a trading instrument,
and that is why I favour the FTSE250, is that it finds it hard to trend
(because pharmaceuticals/oils are defensive, while banks are
interest rate cyclicals and that allows for the potential for each group
to nullify out each other, other than when there is a
general re-rating of equity markets).

I will try to illustrate the point.

Remember over 50% of the total weight of the FTSE100 is made from just 10 stocks.

Oils (BP & Shell) 13.6%
Pharm (GSK & AZN) 10.22%
Banks (RBOS, BARC, HBOS & LLOY) 20.16%
Vod 7.80%
DGE 2.07%

If you accept that oils, pharma and Breverages (DGE) are basically defensive earnings
= 25.9% weighting of FTSE100
and banks are interest rate cyclicals and maybe VOD (consumer cyclical) = 27.24%

The conclusion one is faced with it that 50% of the FTSE100 has the potential to cancel each other's impact out.

It is no surprise, to me, that the FTSE 100 can at times struggle to show a clear trend.

At least the SP500 is much more evenly weighted.

So I use the FTSE250 as a much better indicator of what UK plc is actually doing.

Which since 17/05/2004 has clearly been in an uptrend. And there has been some useful
money made in stocks below the top 20.

 

[splasher]

So we have FT250 in clear uptrend with no signs of changing, FT100 in shabby sort of uptrend that looks like it could break out of to the downside and market failed to break out on the upside when it really should have to catch out the shorts from the current tight range.

I'm generally short but have been jobbing from the longside today (that could be a good reverse indicator!), fortunately bailed at 89.5 after going long at 91.5 so currently falt and waiting.

Longer term my gut now says lower. Mully have you done any analysis on the S&P as a better indicator?
However, to muddy the water the Nasdaq seems quite strong and that has been a good lead indicator for a while now i think....................

PS KJH, i thought the stars were from you!

 

[splasher]

What levels are you lloking at today?
I've got (for the sep future naturally)
4495 Res
4480 Supp and if taken out close of gap to 68/70
4464 Yesterday low

 

[peterpr]

Peterpr,
Scary reading !
kjh

Yep - scary indeed. It rings a lot of bells with me though. I struggle to find disinterested analysis (ie not emanating from the big brokerages/investment banks - with no slur intended of course - and this board excluded), that is making a solid short-medium term case - 1-20 weeks say - for a sustained rally.

That's why I remain pretty bearish overall. Having said that I seem to make my most profitable trades on the long side - mainly intra-day though, but I'm always far more nervous long than short - today is a case in point. I've been long from @ 4475 (nipped in a bit quick last night missing a lower opportunity after the open and am now getting the jitters and beginning to regret it). Still the US futures are up a bit again so I'll hang in there a bit longer I guess.

Splasher's earlier post pretty well sums things up for me right now - I'm preserving capital - just. But staying consistently ahead is a struggle.

 

[splasher]

PeterPr,
Are you using direct access futures or the spreadbetting future out of interest.
FWIW i think we will dip to close the gap this afternoon to 68/70 on futs but am not betting the ranch on it and after that haven't really got a clue but am samll seller for choice......only small worry is bonds may be looking for downside correction at some point in next day or so.............

 

[Fluke]

KJH.
Ref my post June 543 and filled target of 4465 ish.Could we be expecting a Gartley set up to go long at the retest of yesterdays low ?.
What do you think.?

 

[peterpr]

PeterPr,
Are you using direct access futures or the spreadbetting future out of interest.

SB's with 3 providers + CFD's on individual equities. To be honest I've been considering direct access futures for a while now. Only thing in the way is that I use Sharescope RT and they don't supply futures prices in their feed (which of course is also a slight handicap trading index cash SB's). It is also handicapped by not providing volume information on RT indexes -just historical. Apparantly that's a technical issue surrounding the fact that its the actual index rather than the future that is being supplied.

I'm close to having a look at another feed but it means learning a new TA package etc all over again. Fact is I do like trading directly with the market on IG's L2 CFD platform and think I would fare better doing something similar with direct futures. It's a big disruptive move though.

Any suggestions very welcome.

 

[KJH]

KJH.
Ref my post June 543 and filled target of 4465 ish.Could we be expecting a Gartley set up to go long at the retest of yesterdays low ?.
What do you think.?

I don't know...
The FTSE has not had the reaction I expected it would to last nights US move.
Currently it has retraced ( intra day) from yesterdays breakdown point. If todays lows go and yesterdays low can't hold ( other than a false break--and recover just to get the stops) I'm looking for support and the 50% level of the whole swing from 44363 low to 4535 high = 4446
This is also within a few points of 4449-50 = 50% of the previous swing.
( june 22 low - 28 june high)
50% of the previous swing are the strongest support / resistance in my books. ( thats ganns stuff!)
That swing being the low of Mar 24 to Apri 23 high. This was the line in the sand for about 3 weeks where the market rotated back and forth. Was resistance then support. If it doesn't offer support a retest of the Mar lows and lowere are probable.
If it breaks that ( 4450 ) and recovers I think a lot of upward momentum will fade from this market..
The break and failure on Mon 28th June is a worry also. If this market had any strenght it shouldn't have retraced much past 4497 = 50% of the move up from June 22 low.
All IMHO and I've been wrong plenty of times before !
As recently as yesterday !!!!
Add to that the US holiday on Monday.....They are always having holidays lately--more than us Aussies and that just shouldn't be !
KJH

 

[SoupDragon]

Hello All

Where is Bracke today? Did you get the email message Bracke (your private messgenger is off)

Soupdragon

 

[mully]

Hope this is just the 1.30pm test, but we are back again testing the 4470 level again.

Doesn't look that encouraging. Didn't even reach 29/05 low of 4492.

However, I wont get bearish till the FTSE250 gives me a confirming signal

 

[KJH]

Hope this is just the 1.30pm test, but we are back again testing the 4470 level again.

Doesn't look that encouraging. Didn't even reach 29/05 low of 4492.

However, I wont get bearish till the FTSE250 gives me a confirming signal

Good thoughts mully....
I'm out of here for today/tonight.
Have a good one everyone......
KJH