Dow 2006

[mark twain uk]

Will there be a sell off ever is the biggest questions in my books

There will be a sell off eventually, there always is, the questions to ask are when it will happen and how much of a sell-off it will be. The article from which I posted the extract continued thus:

"Perhaps Chambers can take the torch from Ralph Acampora, the Prudential equities guru of the 1980s and 1990s who correctly predicted the Dow would breach 7,000 when it was trading in the lowly 4,000s, and later 10,000.

It should be worth noting that Acampora, now the head of technical analysis at Knight Trading, recently predicted a bearish decline of 25% in the overall market."

A 25% drop from 12,000 would bring the dow to 8,000, but will we still be solvent when that happens?

 

[rav700]

There will be a sell off eventually, there always is, the questions to ask are when it will happen and how much of a sell-off. The article from which I posted the extract continued thus:

"Perhaps Chambers can take the torch from Ralph Acampora, the Prudential equities guru of the 1980s and 1990s who correctly predicted the Dow would breach 7,000 when it was trading in the lowly 4,000s, and later 10,000.

It should be worth noting that Acampora, now the head of technical analysis at Knight Trading, recently predicted a bearish decline of 25% in the overall market."

A 25% drop from 12,000 would bring the dow to 8,000, but will we still be solvent when that happens?

Do you think my stop of 300 points is enough....??

 

[mark twain uk]

rav,

If only I knew. This market is going parabolically and, in my opinion, it will end with a big thud, but all I can say is this: calculate your risk in the worst case scenario, in pounds sterling, and work out how much of a percentage of your trading pot this is. The maximum I would advise would be 10%, if you're over 10% then you are overtrading and it looks more like a gamble than a trade. I have lost large sums of money in the past by doing just this. If you have more than 10% at risk then maybe you should lower the stop loss. In my experience most of the time I allowed for the worst case scenario this came to be be true.

 

[Gap Man]

Do you think my stop of 300 points is enough....??

Feels like a turn coming - added short - stops at 12035 - hold on.....

ooops - sorry 12135

 

[Bez]

Feels like a turn coming

Delta :?: :?:

 

[dewi141]

hi
fwiw - the dec 11900 puts on IG are trading at 93-105.
given that nobody knows where the top will be (except it shoudl be soon), isnt this a better bet than just shorting outright?
cheers

 

[karmit]

Nothings going to happen before 7th Nov.... the market has priced in a Democrat win it seems...
500 point drop if that doesn't happen - but a 499 point drop if it does.

 

[catracho]

if the majority is banking on no big correction before 7th Nov, then aren't probabilities rising that something DOES give before then?

 

[mark twain uk]

I see a drop back to between 11,750 and 11,880 (no fancy calculations, just a hunch as to how low will the market go to clean up all the bulls) but the market may carry on rallying, maybe for a few more days, maybe until 1-3 November, I think the market will turn before the elections, quite a few people will plan to close their longs the day before, and the market needs to hurt as many people as possible

 

[karmit]

Yeah... 1,2 & 3 Nov will be interesting days....

 

[roguetrader]

hi
fwiw - the dec 11900 puts on IG are trading at 93-105.
given that nobody knows where the top will be (except it shoudl be soon), isnt this a better bet than just shorting outright?
cheers

How do they work? I am familiar with normal options, what's the deal with a spreadbet company
Cheers

 

[mark twain uk]

strange movements, cable and gold are down, this suggests that the feds are going to put up the rate, but this would hurt the stocks, so you'd expect the indices to go down as well, instead they rally like there's no tomorrow, one of these moves is a fake one, but which one?

 

[mark twain uk]

I make this nine white candles in a row, quite a feast for a weekly chart, and it's getting more and more parabolic, any guesses where it will all end?

Also, look at the size of the candle for this week, and it's only monday, either a pull back is imminent, or we will see 12,400 soon.

 

[mark twain uk]

the buying programme kicked in at 7:30, half an hour earlier than I expected it

 

[dewi141]

How do they work? I am familiar with normal options, what's the deal with a spreadbet company
Cheers

its just like a normal spreadbet, except that it is on option.
So if you are bearish then you buy the dec 11900 puts at 105 for lets say 5 pound a point.
Then if market falls to 11900 and put rises to say 140 -150, then you can sell the put for 140
and make (140-105)*5 = 35*5 = 175.

If however market keeps on rising past december then it closes at 0, so you lose 105*5 = 525 pounds.

cheers

 

[roguetrader]

its just like a normal spreadbet, except that it is on option.
So if you are bearish then you buy the dec 11900 puts at 105 for lets say 5 pound a point.
Then if market falls to 11900 and put rises to say 140 -150, then you can sell the put for 140
and make (140-105)*5 = 35*5 = 175.

If however market keeps on rising past december then it closes at 0, so you lose 105*5 = 525 pounds.

cheers

Cheers, seems straight forward enough, same same.

 

[fibonelli]

Cheers, seems straight forward enough, same same.

need to be careful in that 12,000 may end up being a support level on any pullback.

has anyone calculated the fib projection levels from the various pullbacks since late 2002?

 

[Pat494]

interesting bit on Bloomers.
The Fed has over 200 Phds in economics etc to advise it.
I make that about 2,000 opinions - no wonder Ben B looks confused !
No point asking if they could change a light bulb ? LOL

 

[roguetrader]

need to be careful in that 12,000 may end up being a support level on any pullback.

has anyone calculated the fib projection levels from the various pullbacks since late 2002?

Yeah cheers, no worries mate, I was just curious how they worked compared to normal options

 

[mark twain uk]

I expect tomorrow to be a sideway, choppy day, in expectation of wednesday's fed decision, which I believe will be the catalyst for a large move, which could be either up or down, but not before a spike in the opposite direction will take out a lot of stops. It can go either way, the fed's decision is not material, unless they do something unusual, but this will be just the excuse for the big players to move the market where they want it.

Note: For those new to trading, please do not base your trades on advice given here, like most other people here, I am only putting my thoughts in writing and in no way do I want to give any advice whatsoever, if I were that clever I would not be still trading, but enjoy a prosperous retirement at a villa near a lake.