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5th December 2017

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Todays market discussion

Todays post here

Negative daily candles on US stocks yesterday may be a top for a while. Pound holdjng FTSE at top of yesterdays range but I dont expect that to last more than a few hours. Still short.

These rallies are gifts to keep selling into. 7380 pivot would need to be broken to negate the downside for now. Also 7300 is strong support, but if the Dow has topped and is correcting it won't hold

Hi Guys I fully respect your experience and knowledge but  I think it's long now.....long.

You are entitled to your opinion Sir, however invalid it may be. FTSE didnt rally hard on a very weak pound this morning so I see very little upside risk. Indeed, I have no doubt the pound will rally in coming days aided by euro agreements and a slowly fading dollar. I reckon we must have one decent drop before anyseasonal rally from the 20th.

Quote from Candlemaster on 5th December 2017, 10:58 am

You are entitled to your opinion Sir, however invalid it may be. FTSE didnt rally hard on a very weak pound this morning so I see very little upside risk. Indeed, I have no doubt the pound will rally in coming days aided by euro agreements and a slowly fading dollar. I reckon we must have one decent drop before anyseasonal rally from the 20th.

Mcg had that original range at 7290-7350...... I think it's still valid......I know yday it broke above and then sold off overnight to 7300 but I feel he was originally right.....its a trap in my humble inexperienced opinion........

This makes me realise how difficult it must be for Nick to put his analysis up and risk getting it totally wrong......not easy....

Quote from anstel on 5th December 2017, 10:40 am

Hi Guys I fully respect your experience and knowledge but  I think it's long now.....long.

I also inclined for long but I think another leg down on Dax is due, maybe I am mistaken. I tried longs 13038, 13048, so far just getting out with a few points. Do you think long will come? On FTSE Nick's 7375 has already been reached and maybe now all day - down down?

Quote from Candlemaster on 5th December 2017, 10:58 am

You are entitled to your opinion Sir, however invalid it may be. FTSE didnt rally hard on a very weak pound this morning so I see very little upside risk. Indeed, I have no doubt the pound will rally in coming days aided by euro agreements and a slowly fading dollar. I reckon we must have one decent drop before anyseasonal rally from the 20th.

Mcg had that original range at 7290-7350...... I think it's still valid......I know yday it broke above and then sold off overnight to 7300 but I feel he was originally right.....its a trap in my humble inexperienced opinion........

Quote from Jack 2 on 5th December 2017, 11:08 am
Quote from anstel on 5th December 2017, 10:40 am

Hi Guys I fully respect your experience and knowledge but  I think it's long now.....long.

I also inclined for long but I think another leg down on Dax is due, maybe I am mistaken. I tried longs 13038, 13048, so far just getting out with a few points. Do you think long will come? On FTSE Nick's 7375 has already been reached and maybe now all day - down down?

I can't really say anything about the Dax Im not trading it at this time......however my feeling is that the Ftse will rise

The thing is its a personal view.....everyone is different....everyone is looking at the same charts.......someone's going to be right and someone's going to be wrong and the chart will tell you after the event....who is correct.

Quote from anstel on 5th December 2017, 11:06 am

This makes me realise how difficult it must be for Nick to put his analysis up and risk getting it totally wrong......not easy....

Not easy at all Anstel!

Intraday not easy thats why I choose to play a higher timeframe. Ofcourse any time frame can be played with appropriate stops but I like to play daily candles and on FTSE usually aim for 100 points minimum.

There are alot of break-even trades but very few losses. How are these minimised?

1. Going all-in on the best signals which are hammer candles at pivots.

2. When not confident which is 70% of time use money management, its very hard for the market to beat you if you are disciplined. At worst you should get a BE opportunity somewhere along the line if price moves against you.

Quote from Candlemaster on 5th December 2017, 11:29 am

Intraday not easy thats why I choose to play a higher timeframe. Ofcourse any time frame can be played with appropriate stops but I like to play daily candles and on FTSE usually aim for 100 points minimum.

There are alot of break-even trades but very few losses. How are these minimised?

1. Going all-in on the best signals which are hammer candles at pivots.

2. When not confident which is 70% of time use money management, its very hard for the market to beat you if you are disciplined. At worst you should get a BE opportunity somewhere along the line if price moves against you.

I've noticed CM that I don't think you have lost a trade recently....very impressive..

Quote from anstel on 5th December 2017, 11:19 am

The thing is its a personal view.....everyone is different....everyone is looking at the same charts.......someone's going to be right and someone's going to be wrong and the chart will tell you after the event....who is correct.

Yeah that's why it's important to focus less on calls and more on process.. let's assume I'm buying here. Where does my stop go? I can't see much support under 7350 until 7300. So that's far too wide and not worth the risk taking the trade even if it rallies. There needs to be a specific set up (e.g. a pivot or a supportive candlestick). Tbh the time to buy was last night at 7300 but that would have involved holding all night and not sleeping. Then this AM you could have bought against 7350 holding and that was good for 10 points. But that set up has gone now as we're back below. For now I can't see a long set up.. only worth it if something happens to make it look attractive. That's not to say it can't rally as it always can... just that if I were to take longs like this on I think overall it has a negative expected value

It appears I am wrong at this stage...

Quote from Mcgcapital on 5th December 2017, 11:32 am
Quote from anstel on 5th December 2017, 11:19 am

The thing is its a personal view.....everyone is different....everyone is looking at the same charts.......someone's going to be right and someone's going to be wrong and the chart will tell you after the event....who is correct.

Yeah that's why it's important to focus less on calls and more on process.. let's assume I'm buying here. Where does my stop go? I can't see much support under 7350 until 7300. So that's far too wide and not worth the risk taking the trade even if it rallies. There needs to be a specific set up (e.g. a pivot or a supportive candlestick). Tbh the time to buy was last night at 7300 but that would have involved holding all night and not sleeping. Then this AM you could have bought against 7350 holding and that was good for 10 points. But that set up has gone now as we're back below. For now I can't see a long set up.. only worth it if something happens to make it look attractive. That's not to say it can't rally as it always can... just that if I were to take longs like this on I think overall it has a negative expected value

That range you were using 7290-7350..... Do you feel it's now invalid due to two breaks above and then declines below again hence your long reference is now the old 7380 ? Thx

Quote from anstel on 5th December 2017, 11:38 am
Quote from Mcgcapital on 5th December 2017, 11:32 am
Quote from anstel on 5th December 2017, 11:19 am

The thing is its a personal view.....everyone is different....everyone is looking at the same charts.......someone's going to be right and someone's going to be wrong and the chart will tell you after the event....who is correct.

Yeah that's why it's important to focus less on calls and more on process.. let's assume I'm buying here. Where does my stop go? I can't see much support under 7350 until 7300. So that's far too wide and not worth the risk taking the trade even if it rallies. There needs to be a specific set up (e.g. a pivot or a supportive candlestick). Tbh the time to buy was last night at 7300 but that would have involved holding all night and not sleeping. Then this AM you could have bought against 7350 holding and that was good for 10 points. But that set up has gone now as we're back below. For now I can't see a long set up.. only worth it if something happens to make it look attractive. That's not to say it can't rally as it always can... just that if I were to take longs like this on I think overall it has a negative expected value

That range you were using 7290-7350..... Do you feel it's now invalid due to two breaks above and then declines below again hence your long reference is now the old 7380 ? Thx

Not invalid no.. there's two parts to it, and the issue is there's always some subjectivity. So 7290-7350 is one range.. then above there the levels are 7380, 7440, 7490, 7540 etc. The thing you have to be careful of is that if it breaks 7350, I could then go next sell 7380, then it breaks 7380 next sell 7440 etc. But that would mean that I'm going the wrong way all the time. So firstly I need to determine what the trend is... up, down or sideways. That's the subjective part, but still probably can get that right 70-80% of the time. With FTSE, we're pretty much going sideways between 7300 and 7380 pivots now. Then I'm anticipating Sterling to rally on the EU deal and the US market to sell off given the reversal yesterday. So that's net bearish for FTSE. So giving bears the edge. So that's my call. I'd say if we cleared 7380 area then the trend is probably changing to up, so at that point I'd stop selling looking for breaks down and look for longs for moves higher. But this week sell near 7380 has been the right play. Even yesterday, we sold off down to 7320 and then it bounced to 7350 for the resell. So 7350 is still relevant... bearish below, bullish above but with the bull moves appearing capped at 7380

Just thinking.....if all the experienced traders read the charts the same way.".....who is taking the other half of their trade......surely there's not enough inexperienced retail traders ?

Also worth saying that no system is perfect and sometimes I miss the moves. Like last week, when it got to 7470 I thought it was breaking out (which was completely wrong). But if you follow a strategy with consistency you'll make money overall. Focus on the first thing you do before entering a trade as being where do I get out if I'm wrong and that helps.. if the place you'd get out isn't close to the current price then i wouldn't take it on as the risk is too high

Quote from anstel on 5th December 2017, 11:55 am

Just thinking.....if all the experienced traders read the charts the same way.".....who is taking the other half of their trade......surely there's not enough inexperienced retail traders ?

Firstly not everyone reads it the same way.. and secondly, it's more complicated than it being a zero sum game and there being a winner and a loser. If I buy, IG need to buy to hedge off all else being equal. So they buy in the futures market.. just because they're buying it doesn't mean someone is short. Price just reflects the balance between buyers and sellers.. so if there are more buyers price goes up or vice versa. Overall, you've got money flowing in in terms of increased money supply, then people switching between various asset classes. It's quite complicated to explain

92% of retail traders lose money, 6% make a bit and 2% make a lot (according to my account manager at IG). But I think it's because trading is an art.. most people come in and think they will just make a killing straight away but the reality is it takes a lot of practice to do it well. Most people give up before getting to the stage where they're able to make money. Livermore said 'its easier for a trader to make millions once you know how to trade than it is to make hundreds in the days of his ignorance.' So true

Quote from Mcgcapital on 5th December 2017, 12:00 pm

Also worth saying that no system is perfect and sometimes I miss the moves. Like last week, when it got to 7470 I thought it was breaking out (which was completely wrong). But if you follow a strategy with consistency you'll make money overall. Focus on the first thing you do before entering a trade as being where do I get out if I'm wrong and that helps.. if the place you'd get out isn't close to the current price then i wouldn't take it on as the risk is too high

That's really interesting thanks Mcg I'm learning a lot off you and I'm grateful......re the 7470 last week on the 28th I though it was breaking also and lost gains from the move when it wouldn't hold.....I should have hedged and locked them in.......re the DUP they have put a spanner in the works and Im not convinced it will be easily removed....

A former brexit minister David Jones who is a eurosceptic on the conservative benches said he was not happy with the key phrases the DUP objected too as well so could be some infighting I'm thinking......

Stupid Dax.

@ Anstel

Correct Sir, no losing trades. One particularly stupid long on FTSE a few months ago had me sweating for a while but doubled up at major support below a week later and escaped witha small profit.

Only thing with my system is you cant move your stop to BE too soon...I have had a fair number of trades move 40 - 60 points in my favour very quickly and watched them rebound to no win.

FTSE has not suited my style at all for the last 6 months.

But thats the game.

The BIG question today is whether US markets follow through on yesterdays shooting star candles.

So expect a bull push early in proceedings and see where if closes tonight.

FTSE has held yesterdays low which will give the bulls hope but the market knows alot of stops lurk just underneath  🙂

 

What bloody long you are talking about? Isn't it sell now?

The DUP were either being used as a scapegoat by a weak PM, or it was part of some convoluted bargaining strategy devised by the negotiating team.  It was frankly impossible that Mrs May could have offered to sacrifice a part of the UK for a deal believing there was any chance it would be accepted by the people of Northern Ireland, or indeed the rest of the UK.  The union isn't up for negotiation, and that has been the DUP position, and the conservative position from time immemorial, let alone during the Brexit talks.  So it all smells a little bit fishy.

They'll have to try a lot harder than that to come up with a workable solution.

Longs are not developing today to my frustration.

Quote from Jack 2 on 5th December 2017, 3:31 pm

Longs are not developing today to my frustration.

You are losing your cool Jack..we can't make it do anything......just wait....and see what happens...

My patience finished, as soon as I came out it started going I think. 2 quid only won today, down and up. Had a disaster earlier but luckily came out back to 0. What a frustrating day for me cos I was free all day to do it.

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