It’s been a while since I last posted and I ‘m trying to remember what has happened. I think last time I posted the FTSE had just tanked 240 odd points. Well since then it seems to have stabilised somewhat. With 5000 proving to much to penetrate in a meaningful way, could 5000 be the support level required for a bounce? Personally I don’t think there is enough good news in the pipe line to give a meaningful rally to cause a new bull market but hey what do I know. I’m sure something will probably happen to spark a rally from the bulls. With the recent down move failing to make a new low I’m not really sure what will happen now. As ever though I am not in the habit of trying to second guess what the FTSE is going to do, although I do like to speculate. Nope I prefer to look at what is happening and trade accordingly. So what is happening with the FTSE? Well it would seem that the market is taking a breather to digest the massive moves we’ve seen recently. This consolidation behaviour seems to happen all the time. The question is where will it go from here. It’s too soon to say a new sideways market is opening up, I would be leaning more towards potentially being in down trend mode. If the price falls below the most recent low then I would think a new down trends has been confirmed. Until that point I’m on still on the side of shorts as I just don’t see any news good enough on the horizon to drive the markets high enough. I know there are rumours flying around about QE3 from our friends across the pond but will this really prove enough?


Thanks to David and Chris for their comments left on my last post Gambling on the FTSE 100 & Pyramiding Spread Bets. On thing I would suggest to Chris is learn to go short. In my view one of the key benefits of spread betting is the ability to go short as well as long. There really should be no difference between the two in your mind. It’s good that you like to sit out the down moves but why not profit from them as well? Markets fall much faster than they rise and bug profits can be made from down moves as well as up. That said this is not advice. You can make your own trading decisions as I’m sure you do and will continue to do so.


Chris I’m assuming from your comment that you received the Naked Traders Guide to Spread Betting that I sent to you? Glad you enjoyed the read. I agree it’s aimed more at complete beginners but it’s certainly interesting reading about others trading stories.


My own spread betting is treading water at the moment much the same as the FTSE. I still only have two positions open with SpreadCo which are pretty much doing nothing at the moment. I keep checking for new trades but nothing is coming along, I think it’s because of the recent volatility. The super trend indicator is based on ATR which is a volatility indicator, therefore when volatility is high the price is going to be further away from the indicator and take longer to cross. There have been a few crosses but none that meet all my entry criteria. Still it’s fine with me, when the markets want me to trade they will let me know. I’ll be here waiting when they are ready, I’m in no rush.


Until next time,
“May the markets be with you!”
The Spread Betting Beginner

August 24, 2011 by Harry
Category: blog