spread betting the dow

comino

Junior member
29 0
Questions regarding sb the dow
how would you rate sb on the daily dow in risk ?
how many trades would an average trader make on the dow in one day?
I usually make 3 to 4 trades
what chart would be best for trading the daily dow?
i use 5min 60 min candlestick chart 20 ma and bollinger bands
and slow stochastic indicators
Thanks
Comino
 

tradesmart

Experienced member
1,286 22
Comino – day trading the Dow using SB is no riskier than any other kind of trading imho, but due to the incredibly large volatile daily range, entry point is critical, and a tight stoploss should be used, probably 20points max. Daily Dow bets can be rolled over to the next day if required.

The daily number of trades depends on whether the index is trending or consolidating – trending, sometimes you can stick with one trade all day - consolidating/rangebound, maybe 5 or 6 trades according to the mood of the day.

All your questions regarding working chart setups may be answered by following Chartman’s daily analysis thread – look for Dow Intraday charts 15/Mar - 19/Mar covering this week.

Regards
 

zigglewigler

Well-known member
346 50
Comino
Don't trade the Dow, trade the SP500 instead, it makes the same moves but with better reward. If you get a tight day the Dow might range say 70 points, but you'll find that the SP500 will put in a better show of say 90(decimal points). The spread offered by most SB firms will be within a point on both, so their is better value in the SP500. Also because everyone jumps all over the Dow, you'll find SP500 spread a lot less volatile, some days Dow will re-quote 5 times to ever single SP500 re-quote. If you run tight stops, you'll be less likely to be taken out by a nervous spread. SP500 is the one to watch since it really runs the show.
 

rossored

Senior member
2,103 56
...better still, dont spreadbet at all ( i know, i know, I constantly say the same things...maybe I should get a commission from IB for all the people I recommend going there???)

ziggle -

the reason the dow "jumps all over the place" as you say is because 10 dow points roughly equate to 1 ES point : hence, it often looks like it jumps about, but S&P/Dow pretty much mirror each other 24/7. The S&P doesnt always run the show, either. Often i'll trade YM on what I see in ES, but also vice versa.

Finally, last time I looked, my old SB company offered a dreadful 1.25-point spread on the spoos, 10 points on the Dow, and a lot of messing about on both of them.

Not trying to be argumentative and I dont favour YM over ES or the other way round. I just try and trade whichever gives me the clearer pattern, the lowest risk, and the biggest profit potential.
 

zigglewigler

Well-known member
346 50
rossored
you misunderstand me, I am referring to the spread offered by the SB firms, that jumps all over the place, as I said the Dow and SP500 make the same moves(in the real market), but it is the quote offered by SB's that is important. Everyone is attracted to trading the Dow because it is the layman's index, the real markets watch the SP futures, period.

D4F offer 4 point Dow and 5 point SP(decimal), with SP putting in bigger moves in terms of points, it isn't hard to see that trading SP500 offers better rewards than Dow, with less nervous Spread Bet activity.
 
 
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