swingin' the ftse: 2009

[Mr. G]

33 week Trend Strength Indicator. Allows a normalised score to be allocated to a price chart to alow comparison of trend strength.

Plot price chart over last 33 weeks as weekly HLC bars. For each weekly H, L or C that lies below the 50EMA subtract 1 point. Say a share / index had three weeks of lat 33 with all 3 H, L and C below 50EMA, all other H,L and C's completely above. This would give TSI of 100-9 = 93%.
I wouldn't say that this trend had a 93% probability of continuing, but it certainly scores better than a chart that bumps along the 50 week after week. Have a look at Old Mutual as an example - I think I recall Friday's round-up gave it 100%.

Thanks Tom. Makes perfect sense

 

[tomorton]

Thanks Tom. Makes perfect sense

Say a share / index had three weeks of lat 33 with all 3 H, L and C below 50EMA, all other H,L and C's completely above. This would give TSI of 100-9 = 93%.
Ooops - I meant 91%.

 

[tomorton]

hi guys

just back from a couple of weeks in the sun and didn't look at the market once!!

my main stuff is with ftse100 shares using the same 3 bar route. don't take much notice of rsi though.

have a stable of about 15 favourites and change the mix from time to time. with these sometimes follow tom's thoughts of not necessarily waiting for 3 bars if ftse looks good. apart from that just eyeball other 85 or so daily and look at those forming 3 bar swing lows/highs.

good trading

jon

On RSI - Last weekend I plotted the FTSE100 performance over the next 4 sessions for the trading days 02-23/11. The one with the lowest 8RSI (Simple), at 32.8, was also the one with the best 4-day FTSE100 performance, +3.9%, and also had the largest number of FTSE350 risers over the same period, at 314 (90%). This date was confirmed as a swing low the next day.

As you might expect, the date with the highest 8RSI, the worst FTSE100 4-day performance and the lowest number of FTSE350 risers over the period was the swing high, 16/11.

Obvious, we all might say.

 

[Mr. G]

On RSI - Last weekend I plotted the FTSE100 performance over the next 4 sessions for the trading days 02-23/11. The one with the lowest 8RSI (Simple), at 32.8, was also the one with the best 4-day FTSE100 performance, +3.9%, and also had the largest number of FTSE350 risers over the same period, at 314 (90%). This date was confirmed as a swing low the next day.

As you might expect, the date with the highest 8RSI, the worst FTSE100 4-day performance and the lowest number of FTSE350 risers over the period was the swing high, 16/11.

Obvious, we all might say.

Sometimes the obvious is worth stating as it's so obvious it gets overlooked. That's why people get run over by buses....

 

[Mr. G]

Putative two day swing low on the FTSE today anyone?

I suspect we'll see another down day tomorrow, however, but that would be gut-feel as opposed to trading what we see....

 

[tomorton]

What I see Mr. G is a swing low last week that was only confirmed when RSI had already gone over 50, keeping me out of equity longs: then a swing high three sessions ago that failed to breach the previous high. Plus the S&P making two-up, two down candlesticks for three weeks but going basically sideways. Uptrend now severely suspect, and I felt safe to open two shorts over breakfast, HSBC and Standard Chartered, which have both made nice hole-in-the-wall patterns.
Tomorrow will tell us more, as ever.

 

[Mr. G]

After my post above we had a third down day on Wednesday (9th) so I had a buy orders at 5246 (above the high of the 9th) which was filled yesterday. So far, so good. I have a very tight stop on one, the other a little looser. Be interesting to see if we run up to 5400ish again and then run out of steam. 25pt H/L range P&F would suggest a top at 5325, hence the tight stop on one position. Time, as always, will tell.

 

[tomorton]

Hi Mr. G - you're certainly game, I have become more cautious on my index trades recently.

The FTSE uptrend is not yet broken but I see RSI as not low enough for a good basis for an up move to continue the uptrend. The 1% P&F shows a compact double top. The last swing high was depressed. The FTSE shows a symmetrical wedge, but this does not reliably indicate break-out direction. The S&P shows an ascending and broadening right-angled triangle, said to have a 70% probability of downward break-out. But your profit target is modest so you should get out in the money.
Hope it goes well.

 

[barjon]

Yes, it's all a bit messy and there are still a couple warning lights shining that the up trend may be over. So tread carefully.

The warning light shining brightest is that we have twice backed off from the November 16th high. The latest 3 bar pullback is thus not a true retracement from a swing high.

That said, the 5200 arena seems to offer pretty good support (remember the resistance there on the way up?) so long isn't a bad bet by any means.

good trading

jon

 

[Mr. G]

Tom - nothing ventured, nothing gained. Only small positions so all a bit of fun really.

First half closed for +52 points, second half closed for +42 points. so not bad all things equal.

 

[tomorton]

Good footwork. Nice start to the weekend.

 

[Andronichuk]

Anyone interested in some Elliott Wave analysis on the FTSE, please feel free to check out my blog and watch my videos I do about twice a week.

There hasn't been much posted here in quite afew days, what do you think about the ftse now?

My personal view is that there is still some upside left before another huge shorting opportunity...


http://elliotticians.blogspot.com/

Please feel free to check it out guys, I am not offering a service or trying to convince anyone that I am some trading Guru....on the contrary, I just want to get HONEST feedback and develop my charting from it (I am quite new to this whole thing).

Many Thanks


Max

 

[tomorton]

Long-range resistance.

I don't pay a lot of attention to inclined trendlines or s/r, but I notice a 2-year downtrend line that demands attention.
On (linear scale) FTSE chart draw line from high 6723.7 01/11/07 through high 6377.0 19/05/08 and see where it leads. It seems to neatly form the cap of the current wedge: we have run at it and tested it several times since 16/11 but never closed above. Will this old resistance hold?

 

[Mr. G]

Long-range resistance.

I don't pay a lot of attention to inclined trendlines or s/r, but I notice a 2-year downtrend line that demands attention.
On (linear scale) FTSE chart draw line from high 6723.7 01/11/07 through high 6377.0 19/05/08 and see where it leads. It seems to neatly form the cap of the current wedge: we have run at it and tested it several times since 16/11 but never closed above. Will this old resistance hold?

Not a bad line for a target IMHO and served me well last week.

25x3 p&f would also suggest the same. If break the line, then the skys the limit....woo hoo :clap:

 

[Mr. G]

Long-range resistance.

I don't pay a lot of attention to inclined trendlines or s/r, but I notice a 2-year downtrend line that demands attention.
On (linear scale) FTSE chart draw line from high 6723.7 01/11/07 through high 6377.0 19/05/08 and see where it leads. It seems to neatly form the cap of the current wedge: we have run at it and tested it several times since 16/11 but never closed above. Will this old resistance hold?

Looks like the line has been broken today, both intraday- and closing-wise.

50x3 p&f close only is right at resistance. Seems 5400 is still the key level.

 

[tomorton]

Its very close Mr. G, depending on how tight you draw the line. I have the close tonight just 2 points clear of the 2 year downtrend line.

 

[Mr. G]

Its very close Mr. G, depending on how tight you draw the line. I have the close tonight just 2 points clear of the 2 year downtrend line.

Indeed and given the pathetic volume maybe a suspect break. Higher again today but with even less volume. Might as well call it a day until the new year I reckon.

 

[barjon]

Happy Christmas guys and gals

May your swings prosper in 2010

All the best

jon

 

[tomorton]

Happy Christmas guys and gals

May your swings prosper in 2010

All the best

jon

All the best to you too Jon.

 

[tomorton]

Is this rally end-of-year window dressing? We've seen it before, where the institutional players drive the price high to the end of December or first week in January, improving their end-of-year performance. The FTSE100 is suspiciously defying gravity, but 250 and the Banks sector chart (still the biggest sector by weighting) gave up the fight long ago.