Indices

Market Short Squeeze




Market Short Squeeze.

Not the best of times as trades go, we’re still believing in a Bear market.

Back in December 2018 and in to January 2019, the markets looked to be in free fall, almost dropping like a lead balloon.

Investors were worried about the Fed potentially increasing rates and in the UK the continuing Brexit drama.

Even in the last few weeks the Yield Curve on US Treasuries has started to flatten; when the yield curve inverts, we take this as a sign that markets expects interest rates to fall rather than rise in the near future, a warning that a recession, lies ahead.

A good indicator, this being as in all six recessions since the 1970s, the US Treasury Yield Curve has signaled a recession about a year before.

Sellers were quick to get out of the market and prices dropped, since then Indices have risen, investors and traders are asking why?

Many believe this to be a number of reason,

  • The FOMOs (Fear Of Missing Out); Small investors have been buying while stocks became “cheaper” hoping to catch the move of stocks going back in to a Bull run.
  • Buybacks; Companies took the opportunity to buy back shares to increase the value of remaining shares.
  • US /China trade talks; recently have been taking a good position with both sides talking in positive tones.

We took the opportunity to take another position in the FTSE 100 as it rose higher to take a contrarian position about a deal being reached.

So we’re in our trades, for how long depends on the next couple of weeks, for now we’ll be getting hit by the Market Short Squeeze.

Market Short Squeeze

 

Still holding our Dow Jones Trade.

Market Short Squeeze

(Our trading and image was done using an account with UK based broker IG)

*Please Note, Forex and other forms of trading carry a high level of risk to your capital as you could lose all of your investment. These products may not be suitable for every investor, therefore ensure you understand the risks and seek independent advice. Invest only what you can afford to lose. We are NOT financial advisers and we do NOT offer financial advice. 




Marks and Spencer Investment




Marks and Spencer Investment.

Once at the centre of the British high street and renowned for it’s quality.

Recently taking it’s turn on the high street to announce a wave of store closures, this has put over 1,000 jobs at risk.

Marks and Spencer has been heading in a downward trend for a long time, their once loyal shoppers are turning away from the retail side over what has been seen as a shun to it’s clothing design, however more people have been opting in the past for it’s food, though this as well as been struggling.

Marks and Spencer has recently gone in to a joint venture with Ocado, a deal worth in the region of £1.8 Billion.

In the face of online competition from the likes of Amazon, and to being late to the online delivery services where the likes of Tescos, ASDA and Iceland already have a foot in the deliver door.

Marks and Spencer has only a limited range of groceries compared to the likes of Tescos and ASDA.

By joining Ocado, the delivery service well known since the early 2000’s Marks and Spencer hope to catch up and sell it’s quality goods to the customer base straight to the doorstep.

On news on the venture Marks and Spencer share price took a hit as the potential cost of the venture to the business became known, can Marks and Spencer afford the cost or have they left it too late.

We had chance to take a sell position before the announcement believing it’s tired business model may be too little too late for the struggling retailer.

Marks and Spencer Investment

(Our trading and image was done using an account with UK based broker IG)

*Please Note, Forex and other forms of trading carry a high level of risk to your capital as you could lose all of your investment. These products may not be suitable for every investor, therefore ensure you understand the risks and seek independent advice. Invest only what you can afford to lose. We are NOT financial advisers and we do NOT offer financial advice. 




Watch Out For Bears




Watch out for Bears.

So 2019 could be the year the markets entered a full Bear Market, some have already gone into the downturn and straight to Bear market however some are not far behind the Bears.

We entered a trade on the Dow Jones at just about the 24000 mark, we’re expecting  price to fluctuate somewhat, this we can see has happened once already, price dropped down to around the 21472 area before the Bulls came in to stall the drop and take price back up.

However the Bears are just too strong and we expect price to continue dropping.

A lot of the reason for the market drop will be due to the volatility as political (US/China Trade War, Italian Government disagreement with the EU and Brexit) and economic uncertainty still haunts investors and may do for quite some time.

We’re going to hold on this trade and wait as we believe a price drop to below the 20000 is possible once any remaining Bulls have been pushed out of the way by the strengthening Bears.

Bears

(Our trading and image was done using an account with UK based broker IG)

*Please Note, Forex and other forms of trading carry a high level of risk to your capital as you could lose all of your investment. These products may not be suitable for every investor, therefore ensure you understand the risks and seek independent advice. Invest only what you can afford to lose. We are NOT financial advisers and we do NOT offer financial advice. 




When will the FTSE 100 be in a Bear Market?




When will the FTSE 100 be in a Bear Market?

Looking for when the FTSE 100 may enter a Bear Market. Despite the media saying a 20% drop is a signal for a Bear Market, the real number is 16%.

Taking a measurement of 16% from the previous high in the summer of 2018 and a 16% drop comes to around 6442.
If price drops below this mark, (red dash line) this could signal the Bears are in full control.

Taking a measurement (purple line)from how far the FTSE dropped in the last recession and price could move to around the 4800 mark.

FTSE 100 be in a Bear market

(Tradingview chart used)

*Please Note, Forex and other forms of trading carry a high level of risk to your capital as you could lose all of your investment. These products may not be suitable for every investor, therefore ensure you understand the risks and seek independent advice. Invest only what you can afford to lose. We are NOT financial advisers and we do NOT offer financial advice. 




S&P 500 W Trade Pattern




Taking the S&P 500 W Trade Pattern.

From the level we can see in late October, price has now made a bounce back above those level.

When price drops as quickly as it has recently, we get a W pattern, price will rally a bit and then will sell off again to test the previous low.

Now the US Thanksgiving holiday is over, and the markets can return to normal, we may see some buyers enter back in to the market.

Taking a technical view, we can see a positive divergence in the MACD the indicator has posted higher lows, from above where we where in late October, so a positive sign that price could continue in a Bullish direction.

Buyers may be coming in to pick up the pace, and take control from the sellers.

Depending on economic events, we may soon see price for the S&P 500 move passed 2900.00 and reach 3000.00

We’ll keep a close watch on our trade, at the moment we remain positive.

S&P 500 W Trade Pattern

(Our trading and image was done using an account with UK based broker IG)

*Please Note, Forex and other forms of trading carry a high level of risk to your capital as you could lose all of your investment. These products may not be suitable for every investor, therefore ensure you understand the risks and seek independent advice. Invest only what you can afford to lose. We are NOT financial advisers and we do NOT offer financial advice. 




Stock Market Tumble Allows More Trade Opportunities




With a stock market tumble allows more trade opportunities.

What a few weeks it’s been, and may still not be over for a while, trade disputes have been stepping up a notch, the mention of around $200 Billion worth of tariffs voiced from Trump and the Beijing reaction from China has meant a stock market tumble recently.

Both Washington and Beijing have stuck to their positions, however we could be upbeat about this, so long as no further trade spat happens or deteriorate between the two.

Not forgetting Brexit, a word close to peoples lips both in the UK and Europe, but also in North America.

We took an opportunity to enter in to some more trades to take advantage of the stock market tumble, with the DAX  we’ve got in to a buy trade on what appears to be a bounce in price, this looks to come from an area of buyers waiting at around the 12000 level, this may last until a possible area of sellers at around 12500.

stock market tumble

(Our trading and image was done using an account with UK based broker IG)

In the FTSE we got in to another buy trade from the move up in price from buyers at around the 7200 to 7300 level, we feel this may go back to pre-economic worries of around and above the 7600 price.

We’ll wait to see what happens when Theresa May is set for talks with the EU on post-Brexit Irish border problems, this could lower the value of the pound, so could potentially help boost the FTSE price.

stock market tumble

(Our trading and image was done using an account with UK based broker IG)

*Please Note, Forex and other forms of trading carry a high level of risk to your capital as you could lose all of your investment. These products may not be suitable for every investor, therefore ensure you understand the risks and seek independent advice. Invest only what you can afford to lose. We are NOT financial advisers and we do NOT offer financial advice. 




Waiting on a CAC 40 Breakout




Waiting on a CAC 40 Breakout soon.

The CAC 40 the benchmark of the French stock market index and closely linked to the German DAX and Euro data.

It’s currently wedges in between the areas of Buyers and Sellers who are dug in not prepared to give an inch, with a small area of breathing space to gather momentum for an expected breakout

The French shares have been moving higher so we believe this may be a breakout overpowering the sellers at around the 5505 area and continue to an upward trend and benefit our trade.

However it does appear that price is moving in to a triangle trend line so price may get squeezed by the pressure of the Bulls and the Bears before the CAC 40 Breakout is achieved.

Who’s going to blink first?

CAC 40 Breakout

(Our trading and image was done using an account with UK based broker IG)

*Please Note, Forex and other forms of trading carry a high level of risk to your capital as you could lose all of your investment. These products may not be suitable for every investor, therefore ensure you understand the risks and seek independent advice. Invest only what you can afford to lose. We are NOT financial advisers and we do NOT offer financial advice. 




FTSE 100 Trading Between Zones




FTSE 100 Trading between zones, we are still in our trade at a profit.

Amid fears of the UK potentially heading for a no deal Brexit, this in turn will weaken the Pound and currently does so, however the FTSE 100 does benefit from a weaker currency.

Other economic news has seen the recent sanctions by the US government on Russia which has led to the commodities selloff,  the FTSE 100 contains a number of mining and oil stocks, a lot of these can be effected by Commodities in Russia.

With note of the economics, for a while the FTSE 100 trading has mostly been contained to between the two zones, an area of support holding buyers at around the 7600.00 price, while the area around the 7800.00 has been keeping the FTSE 100 in check and acting as resistance stopping further upward movement.

The large amount of sellers at around the 7800.00 will need to be weakened if the FTSE 100 is going to reach the 8000.00 price mark.

FTSE 100 Trading

(Our trading and image was done using an account with UK based broker IG)

*Please Note, Forex and other forms of trading carry a high level of risk to your capital as you could lose all of your investment. These products may not be suitable for every investor, therefore ensure you understand the risks and seek independent advice. Invest only what you can afford to lose. We are NOT financial advisers and we do NOT offer financial advice. 




Trade Worries to Quick Short the Dow




At the end of June we took an opportunity with current trade worries to quick short the Dow Jones.

This was a quick move, although not at first planned as we had hoped to stay in the trade longer to allow for the risk/reward ratio to get better.

The Dow along with other stock markets around the world become victim to fearful trading recently shown to be blighting the European market sessions.

In the markets the is still trade worries about Trump’s wording and planned tariffs against Chinese products, and it could be continued that both China and the US are not going to be resolving the trade issues any time soon, however never say never and these things can surprise us when we least expect.

We conducted some analysis and prepared to take a trade, although perhaps for a little longer, but decided a quick “scalp” as it turned out for £1,042.00 profit was good for the fund.

Trade Worries

(Our trading and image was done using an account with UK based broker IG)

*Please Note, Forex and other forms of trading carry a high level of risk to your capital as you could lose all of your investment. These products may not be suitable for every investor, therefore ensure you understand the risks and seek independent advice. Invest only what you can afford to lose. We are NOT financial advisers and we do NOT offer financial advice. 




German DAX Trade




DAX Trade off the mark.

Looking at the DAX to be slowly gaining some ground, we’d entered the trade on the DAX on the up move.

We did have some data out this week regarding the Euro, German Prelim GDP q/q, German ZEW Economic Sentiment and the Final CPI y/y which can have an effect on the DAX strength.

Looking at the chart we could see price entering an area we believe could have some more sellers and even in to the 13200 area, we were in good profit on the trade and didn’t want to risk a pullback.

We closed the trade and made some money for the fund.

DAX Trade

(Our trading and image was done using an account with UK based broker IG)

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*Please Note, Forex and other forms of trading carry a high level of risk to your capital as you could lose all of your investment. These products may not be suitable for every investor, therefore ensure you understand the risks and seek independent advice. Invest only what you can afford to lose. We are NOT financial advisers and we do NOT offer financial advice. 




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