Trading the FTSE at UK and US open.

[kevin546]

I have recently done rather well when I start trading in the morning by viewing the D4Free charts before the open. If there has been no clear direction then I wait for the 3rd pivot to be seen from the 5 minute line chart (set to close). If the before open data does present direction and the first action after the open corresponds with the price sequence then I follow it for small gains and look to the 3rd movement for a possible reversal.

However I do find the reversal's harder to judge and often wait for the next pivot to support it.

Anyway my question is when the US opens (many have a view that it should not be traded in the first 30 minutes). By this time the FTSE will have plenty of data on the chart to work with. Can a signal provided during the early stages of the US open for a continuing move up or down from the chart generally be followed with the same confidence had it presented itself at some other time during the session.

On the FTSE chart today the price had been trading sideways during the lunch period and then started to fall as we approached the US open, and just prior to 2.45pm a lower pivot top was seen which subsequently proved to be a worthwhile signal for a gain of around 10 - 15 points.

I would be interested in your views.

regards kevin

 

[mmillar]

Hi again kevin,

I think there are three things in your post I can reply to...

1. If you're making money out of a particular pattern then that's great. But be careful. It wont last forever. I went through a period once of about 8 weeks where I could predict the opening of the FTSE based on what the Dow did at close. I was so confident of this that I started placing £50-£100/point bets on the opening of the FTSE. Every morning I would get out of bed at 8.15am, close the bet from the night before and have a minimum of £1,000 in the bank. Then, of course, it all went horribly wrong. Money lost, pattern disappeared, neither of them ever to return.

2. "Can the open of the US predict the movement of that session." If only it could! Of course to some extent you can try and work this out. If you read George Angell's book 'Sniper Trader' or read about Taylor's LSS system, this is what they are trying to do. But, like everything, it isn't easy and you have to believe that it works.

3. Personally I would never trade the FTSE when the US is open. As soon as the US is open, all the action and market direction is driven by the US.

cheers again


p.s. I don't think I will reply to any more of your posts or my wife might start getting suspicious