Today I have been a bit bored with work and have been checking my positions far too frequently. In days gone buy when I have been bored I have traded out of boredom which I can tell you now does nothing for your account valuation. Trading because you are bored is a sure way to the poor house. In the past when I have been bored I have attempted to trade the FTSE to try and make some fast cash. I now know when I have done this it was nothing more than just gambling. I may as well’ve gone to the race track and put the money on a horse, In fact I probably would’ve stood more chance of winning. So that is definately a new rule and top tip for today “Don’t boredom trade”

I have been trying to develop a new strategy based on MA. On most charts I’ve looked at when price crosses a 200day MA in an upwards direction if I used this as a buy signal and held the position until the price crossed back down across the MA it would’ve returned a good few points. Of course there are cases where the idea wouldn’t have worked but these losses all seem to be quite small in comparison to the size of the win. I’m not saying that this is a strategy that I am currently using but I think it’s the basis of a strategy that warrents some further work. I think using the 200day MA alone is not enough. I need another indicator to signal to enter the trade. I was looking at using some shorter MA like the 20 & 50 day MA. I need to spend some more time on this strategy as I need to determine entry & stop loss criteria as well. If anyone has any ideas on this please feel free to get in touch.

I have also tried to post some replies on Malolm Pryors spread betting central forum pages but they have thus far failed to appear on there. I know they have to be moderated by the board moderator and maybe this is just taking some time but I don’t know if Malcolm has rejected them or not. If he has I would love to know why

Anway the FTSE 100 dropped around 100pts in early trading but is currently around 30pts down. I think the S&P is dragging is kicking and screaming up a bit. With the FTSE 100 down slightly my portfolio value is also down slightly. Will it end the day down, well who knows.

I do have one comment to make about yesterdays BAE trade. I have been checking the chart again today and I fear I may have made a “Fat Finger” error. The buy price should’ve been 329 not 325. I am now presented with a dilema. Do I ditch the trade? (currently showing a small loss) or Do I let it run?

I guess I really and truly should ditch the trade as it no longer fits my buying part of the strategy. I think this is where my inexperience shows. Deep down I know I should scrap the trade, take a small loss and mark it down as a lesson, but I can’t help thinking if the trade starts to come good I will kick myself for exiting early.

Any comments on this would be very welcome here.
That’s all from me for today.
Until the next time.
“May the Markets be with you.”

June 2, 2010 by Harry
Category: blog