I've done some long term chart hunting today and 14,000 cash dow isn't very far fetched at all over a few months or by year end. It looks to be the target of the upper parallel line with support from the start of this bull run in 2003.
That however doesn't mean a 10% fall couldn't come first!
I am 2 x YM both from around 100 points below this level.
I notice 13,290 acting as a lid on action today and yesterday and a very tenuous double top of sorts building the further below that level we come (currently around 40 points).
As long as this level isn't beaten (which we know it could in ten minutes from here) there is reason to expect further declines firstly to today's lows and then even as low as yesterday's lows around 80 below where we are now.
All this is said with the warning that of course we know the dow could close at all time highs tonight!
For now at least the bears might have the upper hand thanks to GM acting as a drag but I'd suggest if it can't fall further quickly cover when you can as each time the bears fail the bulls get more excited.
Stephen McCreedy
That however doesn't mean a 10% fall couldn't come first!
I am 2 x YM both from around 100 points below this level.
I notice 13,290 acting as a lid on action today and yesterday and a very tenuous double top of sorts building the further below that level we come (currently around 40 points).
As long as this level isn't beaten (which we know it could in ten minutes from here) there is reason to expect further declines firstly to today's lows and then even as low as yesterday's lows around 80 below where we are now.
All this is said with the warning that of course we know the dow could close at all time highs tonight!
For now at least the bears might have the upper hand thanks to GM acting as a drag but I'd suggest if it can't fall further quickly cover when you can as each time the bears fail the bulls get more excited.
Stephen McCreedy
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Way to go 'dog. I'm still short £3 from 13225 since before 1500.
Trading a daily cash contract through a SB.
If support breaks, my target is 13190.
Otherwise, I will bail pretty soon - not wanting to be with it as it climbs up to 13220 again.
Trading a daily cash contract through a SB.
If support breaks, my target is 13190.
Otherwise, I will bail pretty soon - not wanting to be with it as it climbs up to 13220 again.
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Hi smccreedy
Insightful as usual. I covered at 13214 (11 points profit).
I still think it is going to drop a little further, but the 13200 support is strong, and I don't wish to risk it. £33 up for today (1 trade), and I don't see me going back in at this point.
Saying that, I wouldn't rule out a long later, but I'm not taking a new position afer 1900.
Insightful as usual. I covered at 13214 (11 points profit).
I still think it is going to drop a little further, but the 13200 support is strong, and I don't wish to risk it. £33 up for today (1 trade), and I don't see me going back in at this point.
Saying that, I wouldn't rule out a long later, but I'm not taking a new position afer 1900.
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Of course, my exit today means that I am £190 down for the week, since that snafu on Tuesday (mixture of trading through a plain web interface and having poor discipline). Looks like that £500/wk target was a bit ambitious after all. I got as far as £488 last Friday afternoon, but gave a lot back chasing the £12 between me and a round number.
smccreedy - am I to understand you are holding your YM short from the other day? 2 contracts? Over 100 pts against you? (I guess you do those things when you hold positions for a few days/weeks).
How long were you day trading before you felt able to take overnights on indices?
smccreedy - am I to understand you are holding your YM short from the other day? 2 contracts? Over 100 pts against you? (I guess you do those things when you hold positions for a few days/weeks).
How long were you day trading before you felt able to take overnights on indices?
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Fair enough - I exited out of indecision. I once read that if you don't know why you are still in a trade, cover. (I think I should go back to reading some Brett Steenbarger articles, and perhaps a dose of Mark Douglas' "The Disciplined Trader" would be in order.) The offer on TradIndex Dow (which I am still using) is a few points above the CMC quote. I have marketmaker running most of the time now anyways, so I guess I got out at 13210 cash for 11 points bagged.
Interesting thing - I've reviewed my trading records for this week, and the last 2 weeks combined, and I have a net gain in points over both periods. I need to watch my stake size as my average loss > my average gain - not good. I need to work on money management more also - I once thought that a 20 point stop was too close for Dow - now I am using the EMA I think 20 is enough to say I got it wrong. Problem is that TradIndex won't let me set a stop closer than 75 from the market - when I started trading with them last December they didn't have that problem.
I think once I get a few more winning trades with TradIndex, and then withdraw money and trade with CMC from then on. TradIndex are a good company, but the restrictive stop policy and the wide spreads are making me want to look elsewhere for now. Also, I am not comfortable having the same amount of funds in 2 brokers when I only use one and the other isn't paying interest.
I think it is an advantage to trade on prices of one SB firm (TI) while keeping an eye on another feed (CMC). It reassures me that nobody is playing funny buggers with the quote. I have heard some bad things about SB companies, but I am not sure to what extent I believe them
smmcreedy, hope it comes back for you, but be ready to cover before a new high. I'm out for now...
Interesting thing - I've reviewed my trading records for this week, and the last 2 weeks combined, and I have a net gain in points over both periods. I need to watch my stake size as my average loss > my average gain - not good. I need to work on money management more also - I once thought that a 20 point stop was too close for Dow - now I am using the EMA I think 20 is enough to say I got it wrong. Problem is that TradIndex won't let me set a stop closer than 75 from the market - when I started trading with them last December they didn't have that problem.
I think once I get a few more winning trades with TradIndex, and then withdraw money and trade with CMC from then on. TradIndex are a good company, but the restrictive stop policy and the wide spreads are making me want to look elsewhere for now. Also, I am not comfortable having the same amount of funds in 2 brokers when I only use one and the other isn't paying interest.
I think it is an advantage to trade on prices of one SB firm (TI) while keeping an eye on another feed (CMC). It reassures me that nobody is playing funny buggers with the quote. I have heard some bad things about SB companies, but I am not sure to what extent I believe them
smmcreedy, hope it comes back for you, but be ready to cover before a new high. I'm out for now...
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And from the current price, and the cross of the EMA(100), I'd say we almost caught the bottom there. Pats on the back in order.
I would say that day trading is a lot more risky than longer time scales as the signals and patterns are less reliable. The biggest reason day trading is harder and generally speaking not to be advised is becuase the hardest thing to do is get to break even, if cover the spread. The spread is what stands between you and and trading being a 50/50 bet. From this point of view the more you trade the larger the edge working against you and the harder it's going to be for you to overcome that.
That side you don't seem to be day trading in the sense of placing ten trades open and closed a day.
Let me give you an example:
If I trade one contract of the YM (£10 per point) I pay around £2 in costs to open and close the trade. Say the spread on the contract is 1 point my cost to trade is £12 or 1.2 pips.
If you are spread-betting the cost on £10 a point might be £20 or more plus the price is likely skewed against you making it even harder to make money.
The more times you trade the harder it is going to be to make money.
The problem is trading becomes addictive and you want action all the time, that's how brokerages and SB firms etc stay in business. I'm not saying this is bad but I'm saying you have to know WHY you're trading. At the moment I'm losing money because I'm bored simple as that.
If you want to make big money more safely over the long term it will be easier to find some big moves to back over a longer period of time. The % returns might not be as good as a day trading well but the chances of winning overall are a lot higher.
Most newer traders day trade for the buzz and because they don't feel they have enough to make longer term moves count (Why take 100 points off the dow in a month when I can do 20 a day sort of thinking).
If I was newer and spreadbetting I'd be looking to back trends for a longer period ie if the market closes at it's highest in ten days buy it with a stop below the breakout or below the low of the last five days etc.
It is less exciting but chances of success are greater longer term.
I know this rant won't win me any friends on here but it's a fact, day trading is harder ie your edge is smaller if not negative than trading over a longer period.
I am currently working towards getting more money on longer terms trades and moving away from the 'scalping' or doing it so small it's more of a hobby than a living.
Stephen McCreedy
That side you don't seem to be day trading in the sense of placing ten trades open and closed a day.
Let me give you an example:
If I trade one contract of the YM (£10 per point) I pay around £2 in costs to open and close the trade. Say the spread on the contract is 1 point my cost to trade is £12 or 1.2 pips.
If you are spread-betting the cost on £10 a point might be £20 or more plus the price is likely skewed against you making it even harder to make money.
The more times you trade the harder it is going to be to make money.
The problem is trading becomes addictive and you want action all the time, that's how brokerages and SB firms etc stay in business. I'm not saying this is bad but I'm saying you have to know WHY you're trading. At the moment I'm losing money because I'm bored simple as that.
If you want to make big money more safely over the long term it will be easier to find some big moves to back over a longer period of time. The % returns might not be as good as a day trading well but the chances of winning overall are a lot higher.
Most newer traders day trade for the buzz and because they don't feel they have enough to make longer term moves count (Why take 100 points off the dow in a month when I can do 20 a day sort of thinking).
If I was newer and spreadbetting I'd be looking to back trends for a longer period ie if the market closes at it's highest in ten days buy it with a stop below the breakout or below the low of the last five days etc.
It is less exciting but chances of success are greater longer term.
I know this rant won't win me any friends on here but it's a fact, day trading is harder ie your edge is smaller if not negative than trading over a longer period.
I am currently working towards getting more money on longer terms trades and moving away from the 'scalping' or doing it so small it's more of a hobby than a living.
Stephen McCreedy
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Sound advice I am sure. I don't trade for excitement. Thats not to say that I don't get a little high after a good day or week. Last week I was in and out of the market 10 times a day.
I traded once on Monday last week. The following covers the remainder of the week.
Total Trades: 48
Winning Trades 39
Losing Trades 9
Losing Trades % 18.75%
Gross Expenses (spreads): £ 333.00
Average Expense £ 6.93
Gross Losses: £ 395.00
Average Loss £ 43.88
Net Profit £ 345.00
I am a little reluctant to post figures, as I have seen people flamed for "bragging" etc. - but last week's results show how much I have been paying in spreads because of "over activity".
I am now looking to make a maximum of 3 trades on the Dow per day (from 14:30 to 21:00). I would like at least 40 points per day (and I am trading £2, then scaling in with an additional £1 for a total of £3pp)
So I suppose I have been a "proper" day trader trading so frequently. I intend to increase the timescale I trade as I improve, but as of now I have neither the margin or confidence in my judgement to hold overnights on indices. I'm pretty wary of "stop-entries" as well.
I traded once on Monday last week. The following covers the remainder of the week.
Total Trades: 48
Winning Trades 39
Losing Trades 9
Losing Trades % 18.75%
Gross Expenses (spreads): £ 333.00
Average Expense £ 6.93
Gross Losses: £ 395.00
Average Loss £ 43.88
Net Profit £ 345.00
I am a little reluctant to post figures, as I have seen people flamed for "bragging" etc. - but last week's results show how much I have been paying in spreads because of "over activity".
I am now looking to make a maximum of 3 trades on the Dow per day (from 14:30 to 21:00). I would like at least 40 points per day (and I am trading £2, then scaling in with an additional £1 for a total of £3pp)
So I suppose I have been a "proper" day trader trading so frequently. I intend to increase the timescale I trade as I improve, but as of now I have neither the margin or confidence in my judgement to hold overnights on indices. I'm pretty wary of "stop-entries" as well.
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Oh, forgot to mention. 2YM == £20pp. I wouldn't think of trading that size on a SB. If I get that far along that I would trade £10pp or above (with proper risk and money management), then I would open an account with InteractiveBrokers and trade the futures on LIFFE and whoever does Dow futures. Either that or use that offshore SB company who actually fully hedge positions and only have a slightly wider spreads than the market price.
LL - the minimum stop loss on the Dow with Tradindex is 30 - where you getting 75 from ?
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LL - the minimum stop loss on the Dow with Tradindex is 30 - where you getting 75 from ?
https://www.tradindex.com/product_info/index.asp
Thats for the future though. Sorry. I didn't realise about the 30 points on the daily cash. If I had known that, I'd be £180 richer right now. (4*(75-30)). Thanks for letting me know.
I feel rather silly right now.
Proper planning and preparation prevents .... poor performance?
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13217 is bid for the Dow with CMC. I wonder is this the correction to lower levels now? I'm out, who here has a position?
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frugi, just going by what smccreedy said, but thanks for the info.
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Double top, CCI just went overbought, and I missed 15 tics of that move. If there is a retracement to the EMA(100) and then a continuation of the downtrend I will consider another short - but a small one.
Anyone else still in?
Anyone else still in?
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Sold £1/tic @ 13222
Stop @ 13252
Small stake as so close to 21:00 expiry. £33 up today, so good change of a positive outcome overall even if this stop gets hit (and the gap isn't too bad)
Stop @ 13252
Small stake as so close to 21:00 expiry. £33 up today, so good change of a positive outcome overall even if this stop gets hit (and the gap isn't too bad)
Sorry my apologies was thinking 'Z' and typing 'YM'.
1 YM = $5 (£2.5ish).
Still short and still not that hopeful of a good end to this trade.
I guess just failing to make new highs should be something to cheer if you've been caught short.
Glad I'm only in enough for it to sting not cut me in half.
Still, I am so reluctant to cover after the 800 rise it's put in in the last month.
I guess all the steadfast shorts like me are what is pushing it higher. The irony of it makes me laugh.
Bears give up and you'll get the fall you want!
Stephen
1 YM = $5 (£2.5ish).
Still short and still not that hopeful of a good end to this trade.
I guess just failing to make new highs should be something to cheer if you've been caught short.
Glad I'm only in enough for it to sting not cut me in half.
Still, I am so reluctant to cover after the 800 rise it's put in in the last month.
I guess all the steadfast shorts like me are what is pushing it higher. The irony of it makes me laugh.
Bears give up and you'll get the fall you want!
Stephen
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....and I've just sold a 2 hour low. Brilliant!
