FuturesTechs Blog

Technical Analysis is an essential tool if you are going to trade using CFDs or Spread Betting.

The vast majority of professional day traders use technical analysis in some way shape or form during their trading day. They are aware what the important technical levels are for the markets that they trade. some do this work themselves, some rely upon services like FuturesTechs, knowing that we’ve got an 8 year track record of providing this information to the bulk of the UK Pro trading community.

Many newbies to trading struggle with how to “structure” a trade. Hopefully we’ll shed some light on this with today’s blog post.

It’s all about the levels, and that’s what we do here at FuturesTechs each day: We look at the levels that the market may be looking at, where things may change, where the buyers may return after a sell-off, where the sellers may wake up if the market starts to rise. These are commonly known as support and resistance.

Support is the name given to downside levels; prices below here the buyers may have returned previously, or where they may return today. If we fail to hold support levels the bears are obviously dominating; not giving the buyers the chance to defend these key price levels.

Resistance is the name given to price levels above the market where there may be some”action”. Either we’re going to get to these levels and fall over, or the market should see a strong reaction if we break above them.

These levels are quite often something as simple as old highs and lows, however old they are. We have found markets reacting to levels from over 20 years ago. The market has a long memory, and with charts readily available to all and sundry there’s no excuse not to be armed with the important lines in the sand as you head into each trading day.

The best traders in the world react to a bunch of different things to put on their trades: They wait patiently for a piece of news to come out, or for a technical level to break or hold, or for the market to do a certain thing that they’ve been expecting. They wait patiently. Lots of money can be lost doing trades for the sake of it. Boredom or the need to be involved is a dangerous emotion that a trader has to deal with.

There is little point in trading in between technical levels. The levels are created because they are the prices where things changed previously. They are the “action areas”. Why mess around trying to put trades on in “no mans land”? If you want to buy the market, chose a support level and put your buy order at or above there.

If you need somewhere to put a stop order you can again use a technical level.

Here’s an example: We were bearish of the Eurostoxx 50 Futures today despite Friday’s gains. We had a bold resistance level at 2704. Our bold levels are the important ones. So if we’re bearish and the market rallies to a bold resistance we would suggest selling before the level with a stop above it. The high this morning was 2698….

If you had sold at 2690 with a stop ay 2710 (or our next resistance level at 2728, if you want to give it a bit more “breathing space”) you would have got short and never been far offside.

On the same report we have bold supports at 2640 (the overnight gap) then right down at 2467 and 2418.

So this is the bit that isn’t “harry hindsdight”, just in case you want to jump on the idea that I’m writing this after the event: I will look to cover the short trade at 2470, but if we hold 2640 today I would just get out and cover the trade for either a small profit or at worse nothing. I think we need to break 2640 today to give this trade credibility. In other words we are using another bold level (this time a support) to add weight to our trade. If we don’t break below 2640 then maybe the bears aren’t ready to push us lower just now.

IT’S ALL ABOUT THE LEVELS.

So If you’re just starting out trading, whether it be with a Spread bet account, or CFD’s, or DMA (Direct market access) I would urge you to make technical analysis part of your daily process, AND TO TRADE THE LEVELS.

Be Careful!

If you are a regular reader of our reports, or if you’ve seen me on CNBC any time in the last few months you’ll know that we’re staying right out of the rush to pick a bottom on this equity market sell-off, a rather thankless task that so many people appear to be happy to do. This is how it works: If you are a market commentator and you’ve been calling the bottom all the way down, you may as well carry on, because at some point you’ll be right. Then you can say for the next three years “I picked the bottom”. It upsets me that these so called experts are happy to continue to give dud advice to people just to try and save their own face.

Here’s something else: The market will only bottom out once all of these people STOP calling it. When the towel is thrown in by the majority, and most commentators start talking about doom and gloom downside targets, is when we’ll get a bottom. Maybe that’s why Hugh Hendry was given an entire hour on Channel 4 last night to pick over the wreckage of the sub-prime crisis. It was a great bit of TV and you can’t but love the man!

As per last week’s Blog on the sentiment cycle, the bottom will most likely come when people give up trying to call it, and when the market resigns itself to a future of pain and misery. So we’re probably not quite there yet…

I looked back at our analysis in 2003 and saw that we were around 400 points off the low before we called started saying bullish things.

The DAX is certainly well off the lows over the past two sessions, on the back of the world’s most spectacular short squeeze. VW shares jumped from 200 Euros to 1000 Euros in two days. I don’t even want to start to explain the ins and outs so here’s a link to the story on Bloomberg’s website.

http://www.bloomberg.com/apps/news?pid=20601085&sid=aWeWGIPhKfnk&refer=europe

The upshot is that Volkswagen has now become the world’s largest company by market cap on the back of a short squeeze. This story will only get bigger (although I don’t think VW’s market cap will!) and we’re bound to hear some fallout in coming days or weeks.

One wry (and somewhat tongue in cheek) observation on this shenanigans: We won’t see a financial stock reacting higher like this in the coming months, because the shorts have been banned…

Finally, In my spare moments right now I am doing something that I force myself to do once a year: I am re-reading “Reminiscences of a Stock Operator” by Edwin Lefevre. THE BEST BOOK EVER ABOUT THE MARKETS. i only got to chapter 1 when I read this quote:

“Another lesson I learned early is that there is nothing new in Wall Street. There can’t be because speculation is as old as the hills. Whatever happens in the stock market to-day has happened before and will happen again”.

Say no more…

As always my best advice if you’re trading these markets is “stay safe”.

Cheers,

Clive.

This week’s blog is written by Bradley Jordan, who has been ably assisting me here at FuturesTechs for over a year now. I hope you enjoy his first effort, based upon his observations of the current price action in the FTSE futures.

Cheers,

Clive.

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Earlier this year I completed my Society of Technical Analysts (STA) diploma and one of the first aspects introduced to me was the idea of Market Sentiment and in particular the Sentiment Cycle, a theory developed by Justin Mamis (author of The Nature of Risk, Stock Market Survival and The Meaning of life).

Someone once said to me, “The Market is a mechanism for messing as many people about as it can, as often as possible”. Sounds a bit cynical, but I believe a firm knowledge of the sentiment cycle and an understanding of where we are within the cycle could help us guard against being messed about and give us a clue as to where we’re heading (like a ‘roadmap’)

This prompted me to have a look at a historical chart for the FTSE, to try and glean where we’re at, and if this could give me an indication as to what the future has in store for UK stock markets.

Justin Mamis sums up nicely what the Sentiment Cycle represents “What we have is essentially a graphical representation of the manic depressive moods typically experienced by market participants as a function of time and price in one complete sentiment loop.”

See the chart below, taken from Mamis’ “The Nature of Risk” book.

Before we go any further, let’s take a quick glance at the different phases and the market psychology behind them.

Returning Confidence

By the time confidence is fully restored the markets have been rallying for some time. They start to get choppy and retracement moves get consecutively more fierce, each one more intimidating than the last.

Buying the Dip (the big dip)

A huge pullback now gets underway, even larger than the scary one you may have witnessed last month or so. After such a dynamic bull run, investors are willing to take on a phenomenal amount of risk and the smart money buys the big dip. Also, money is still flooding in from the general public, who likely read in The Sun that stock markets will remain strong for all eternity.

Enthusiasm

At this stage all economic data still supports the idea of higher prices. Traders that didn’t get involved in the last dip-buying opportunity now have hard evidence that it worked before. All of the traders that wanted to be long, are long (there are no more buyers), causing prices to decelerate. Distribution starts to take place, i.e. stock transfers hands, from smart money to stupid money…. Strong to weak.

Disbelief

Traders start to get that gut wrenching feeling that something may be changing but the fundamentals still don’t back this up, and people cling onto hope alone. Analysts start to get subtle warnings. Maybe previous market leaders start to break below important support levels or Moving Averages.

Overt Warning/Panic

Typically there’d be a catalyst here (i.e. big banks like Lehman brothers start to file for bankruptcy… sound familiar?). The index will break below a previous reaction low or maybe the 200 day Moving Average. News readers will be telling the world that the fun is now over. Intelligent investors start to sell rallies, giving stock prices little/no chance of any recovery.

Discouragement and Aversion

Prices have been rattling off for some time now, as the general public start shedding stock and the short sellers are stronger than ever. There’s no good economic news flow and everyone thinks that stock markets will go down forever.

Wall of Worry

Certain market sectors will now start to bottom out as everyone that wanted to sell has done so. The smart money now starts to move in slowly, resulting in the market pausing for breath or drifting along sideways for a few months. There are no sellers left, so despite the bad news flow markets start to creep higher. Short sellers start to cover their positions, adding fuel to the fire.

Aversion to Denial

Markets start to trend upwards. Short sellers start to get concerned that sentiment has changed. With no sellers above the market, these sorts of moves can be fast and sharp and tend to leave people behind.

This brings us back to ‘Returning Confidence’.

So where are we now?

Below is a weekly chart of the FTSE Futures (Dec’08). I have labelled the chart accordingly with respect to the different phases.

So the chart is suggesting that we’re in ‘panic mode’ just now approaching the “discouragement” phase.

What does this mean for the UK stock market?

Well, it means that the pain is not yet over, and that we’ll make another new low before a bottom is in place.

This would be followed by a sideways period and a slow grind higher, before we can start to truly think Bullish thoughts once again.

Let’s see how it all pans out. In the meantime one thing this does suggest to us is that there’s light at the end of the tunnel in the long-term, but in the short-term as we said all along, this is not the time to be picking a bottom.

Bradley Jordan.

Whether you’re trading direct market futures, or CFDs or Spread Betting, the lessons you need to learn to become a successful trader are the same, and they’ve been learnt, usually the hard way, by the best traders in the world. The reason they make money trading isn’t anything to do with the type of product they trade, it’s to do with the lessons they’ve learnt, and their day to day disciplined application of those lessons.

Why have I started today’s blog posting along this line? Because it’s the beginning of September, and we’ve just come out of a tough month. August can often be a tough month for traders, as I suggest in the “PS” from my last blog posting. The other reason I’m talking about this is because we’ve lost a few of our newer “individual” customers this month (which is unusual), and the main theme seems to be that they have lost money in August.

Why is August such a tough month? Because half the market participants go on holiday, and the lack of volume can wreak havoc. There are two very different conditions that can ensue:

The market can suddenly become extremely volatile, with moves making little sense. Moves also tend not to last too long, which can be a real problem for analysts like us and traders like you, who rely on sustainable trends unfolding.

Or the market can just go very very quiet and crab sideways with very little interest shown either way. Again this is problematical for many traders, as there are no big moves to get on.

We find it frustrating to talk about these sort of markets as we feel people don’t want to hear “the market not really going anywhere”. But if that’s what’s happening, then that’s what’s happening! This introduces a use for the FuturesTechs service that I’m not sure our newer customers are fully utilising. We will do our best to get you on the right trends at the right time and keep you in a solid move by sticking with the trend, but if things become messy and confused then we will tell you, and if you’re looking for a solid trend it’s time to step away from the screen. Either look at a different market, or catch up with that pile of paperwork that you’ve been meaning to deal with.

The best traders in the world abide by one word more than anything; and I’ve already mentioned it once today: DISCIPLINE. One very important discipline is to make sure you don’t over-trade, you don’t trade because you’re bored, you don’t trade because you need to make X amount by the end of the month. If there’s no clear trend then you are only going to give your money to the market, and there’s plenty of willing takers of your hard earned lolly.

So always be aware of market conditions, and on this note be aware that we are now entering a very interesting period of the year. The run it to Christmas is usually a time when there are strong moves in the market. Between now and November I’m sure we’ll identify plenty of big moves that can be jumped upon and provide profitable trading opportunities.

We may already have the first of these, with Oil selling off through key support (around $110 in Brent Crude) first thing this morning, and Gold Futures failing at key resistance (850) towards the end of last week.

We’ve been in these markets for years, and been analysing them for professional traders since 2000. We’re giving you the chance to share this wisdom on a daily basis, for just 50 quid a month. Can you afford to pass up this opportunity? Do you want to make money trading, or become another one of the 80% who fail?

You decide.

www.futurestechs.co.uk/subscribe/

Cheers,

Clive.

Have a look at this “mystery” chart and tell me what you think?

Does anyone think this (whatever it is) is going down any time soon?

Hopefully we’re all thinking the same thing: That it looks very much like something that’s got a bright future, something that’s going up in the world. There doesn’t seem to be too much evidence that it is topping out, would you agree? In fact if this was a stock and you owned it you’d probably be more than happy to hold onto it, yes? And if you felt the market was going to head lower and you wanted to find a short trade to put on you probably wouldn’t chose something as strong as this, agreed?

It was Charles Dow almost 100 years ago who suggested we can define an uptrend as a series of higher highs and higher lows. In contrast a downtrend is defined as lower highs and lower lows, which brings me on to the next chart.

As you can see this is a chart for Royal Bank of Scotland between October 2006 and the present (August 2008 in case you’re reading this in retrospect). Now I’d like to point out straight away that I could have chosen any number of bank stocks from any number of countries for the purpose of posting this blog. I used RBOS because I’ve got a couple of mates who work there and I’ve got a sadistic streak. Sorry fellas.

Because I think it’s fair to say this chart is quite a bit different to our first chart, wouldn’t you say?

Well the eagle eyed amongst you may actually have noticed that it is actually THE SAME CHART, but “flipped”. We have effectively put a mirror below the real chart to create our “mystery chart”. So the mystery chart is RBOS with 7 quid at the bottom and £1.50 at the top.

Now think about the paragraph above, and think about your reactions when you read it. I would imagine it was something like this:

“… it looks very much like something that’s got a bright future (I agree!), something that’s going up in the world (yes indeed). There doesn’t seem to be too much evidence that it is topping out (too right, it’s a stonker!) , would you agree? (yes) In fact if this was a stock and you owned it you’d probably be more than happy to hold onto it, yes? (yes please, love it!!). And if you felt the market was going to head lower and you wanted to find a short trade to put on you probably wouldn’t chose something as strong as this, agreed? (agreed, let’s short something else, surely).

Which brings us to the title of this Blog: “The most common question of 2008″. Which is, of course “Should I buy Bank Stocks?”. I reckon you just answered your own question!!

NOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO!!!

If you want to gamble go to a casino. If you want to play the stock market or make money spread betting follow some simple rules and don’t just put on stupid high risk trades. I’m sick of being asked this question. It’s a joke. It’s simple: Don’t buy things that are still going down.

Let the pros tell you when to buy, ie let the market tell you when enough professional buying has happened in a Stock that it is now in an uptrend.

If you “flip” the chart and there’s no way in the world you would SELL our mystery chart, then what the heck are you doing even thinking about BUYING it when we put it the right way round?

The point I’m making isn’t that Bank stocks haven’t bottomed out. They might have done, but there isn’t enough weight of evidence yet. It’s a dangerous trade, and there’s no need to rush in. These stocks could go sideways for years now, or even keep heading lower, after all we haven’t broken our series of lower highs and lower lows yet, have we?!

Can I finish by saying that we have the chappies at Updata to thank for making “flip” a standard part of many charting systems these days. I’m pretty certain it wasn’t until they started to expound exactly what I’ve done above.

Cheers,

Clive.

PS. August is turning out to be a bit of a damp squib in Equity markets so far, and the best advice I can give is to suggest you don’t get too carried away if you’re trading Equity Indices like the Dow and the FTSE. The market has a habit of taking money off of you in quiet periods. There could be some really solid trends to trade between now and the end of the year. Don’t take yourself out of the game trading during low volume quiet periods like now.

One of the things we at FuturesTechs towers take very seriously is Marabuzo lines.

What are they? A large bodied candlestick on a Daily chart is the result of a big one way push over the course of a day. In the example of large red real bodies the market often wakes up the next day sure in the knowledge that yesterday’s bout of selling should be good enough to guarantee further losses today. But sometimes things feel a bit overdone and there can be a reaction higher the next day. The big question then is whether this is a short term gains that deserves to be sold into, or if the market is going to continue to rally and take back the losses of the previous day?

The Marabuzo line is the halfway point of the real body (ie halfway between the open and close) of any large bodied candlestick, and we’ve found them to be excellent reference levels in the days after this “big event” Candles.

This week’s ICE Brent Crude Oil Chart is no exception. Last Thursday we saw a big down day.

The Marabuzo line of this session’s Candlestick was 133.78.

The high last Friday was 133.69

The high on Monday was 133.57

The high on Tuesday was 133.75.

Close enough?!

Tuesday turned out to be a pretty Bearish day, as was Wednesday. The Marabuzo line of Wednesday’s big red candle was 127.36, and Thursday’s high/failure was 127.25. Close enough?!

Which prompted our Brent Comment today, as per below. You can click on the image to see it in full size.

All very interesting, I’m sure you’ll agree.

Have a good weekend, and be sure to subscribe to our members area so you don’t miss out on these sort of calls. Click here.

Come on Essex in the Twenty20 tomorrow! And a Happy Birthday to my old mate Mickey. How old?! OUCH!!!

We have had our web offering up and running for a few months now and we’ve been speaking with plenty of private traders of all different levels of experience. We have heard a few stories of people losing lots of money, and still not really feeling that they’re swimming above water.

Many of these people got signed up to training seminars that are advertised with lines like “make £50,000 a year for just 10 minutes work a day”. And there’s our first “tip”: Does that sound too good to be true? What do they say: “If it sounds too good to be true, it probably is!”. Come on! You’re intelligent people. Also if you see someone trading a “live” trading system, make sure it is live. And think about this: If I had a trading system that was whiz-bang nailed on money making and amazing, would I tell anyone about it?

Now consider this: There is a school of thought that 80% of traders who Spread Bet lose money. There is another school of thought that Spread Bet firms move the market to where your stop is and knock you out of trades. Are you sure? Most spread bet quotes are based on the underlying index. The spread bet firms’ highs and lows are matched to the underlying almost to the tick. So they’re not moving the market up and down to try and trigger your £2 stop. Please!

There are some very important disciplines you need to exercise before you start trading. Here are just a few that I can think of off the top of my head.

Start off small. Why give away all your money while you are learning to trade.

Understand and utilise Risk/Reward. Whenever you put a trade on make sure you’re aiming to make more money that you’re prepared to lose. If you always do this then you can lose as many time as you win, but you’ll still make money. If you try and make three times what you’re prepared to lose (known as a 3;1 Risk/Reward ratio) then you can have 7 losing trades out of 10 and STILL make money. Technical Analysis is the best tool for working out when you are putting on a trade with favourable Risk/Reward.

Never bat against a strong trend. Why do people feel the need to try and buy something that’s falling like a stone, or sell something because it’s really strong? This is one of the biggest mistakes new traders make. Don’t try and trade against a strong trend. We look for Candlestick patterns to suggest trend changes, then wait for confirmation. We saw a Hammer on the FTSE Futures chart last Wednesday, but it wasn’t until Friday that we started believing there was more upside to come. Even now we’re not getting too carried away, and have reasonable upside targets, because the Bears could wake up at any minute.

We are currently looking for the recent pullback in Oil to do a bit more. But we’ll soon change our minds if the positive candles start to appear, and the smart money will be made by getting long once this happens and riding it back to $147.

Find one thing to trade (at a time) and learn it’s personality. Different markets behave in different ways, and you may need to spend the early months discovering a market that suits you. You will all have different approaches to risk, volatility and the like. You will also have to skew the type of product you’re looking for towards how much time you can devote to it. I would suggest that something like the DAX Future or the S&P 500 would require a lot of attention, whereas something slightly less volatile may suit those who don’t have time to watch it’s every move. Yuo may need to try a few different things before you find something that appears to work for you.

Be well capitalised, and don’t risk it all on one trade. There is no point trying to turn £200 into £2000. You have a much better chance of turning £2000 into £20000. With £200 in your account you run a good chance of doing your dough in the first few trades. Many firms offer a dummy account or a “training account”. Good idea. Take advantage. Press buttons. Make mistakes. Then start risking your own money once you’ve got a few of these mistakes under your belt. Once you do start trading don’t risk all your capital on one trade. This isn’t the Casino where you get your pile of chips and stick it all on red because you fancy a Gin and Tonic. This is a business (well it could be if you take it seriously).

Manage your emotions. Trading can be an emotional business, and you need to make sure you can manage or control this, otherwise you will make decisions with your heart and not your head. Many professional traders spend lots of time making sure they’re in the right frame of mind to trade. A good way of doing this is by putting together a plan at the start of each day; collating your ideas. Then you have something to refer to. You can “keep it sensible” and not allow yourself to start making baseless emotionally-driven decisions.

This is just a few thoughts that may help you along the way. I’m sure future blog posts will expand on this theme as I think it’s extremely important.

I’ll sign off with one more thought, which kind of follows on from the previous point: Have a strategy. If you’re trading is based on “I bought it ‘cos I thought it was going up” then you shouldn’t be trading. Again this is where Technical Analysis can serve a trade so well. It gives then something to reference off in the decision making process. This is what Futurestechs does for many professional traders, and what we hope to become for many more of you; a useful reference point and a good building block towards a successful trading career.

Things have been a bit frantic since the last Blog post, both for myself and the markets! As well as speaking at the IX Investor Show and the Trading Symposium I have also finished the first draft of my up-coming book; “Candlestick Charts. An introduction to using candlestick charts”. I just hope there isn’t someone round at Harriman House right now pulling their hair out wondering how the heck they’re going to make it into a book!

The events were well attended and both pulled in a crowd of around 200 people to listen to my ramblings on Candlesticks.

Having spoken in front of these sort of numbers in seminars, surely today’s appearance on CNBC would be a walk in the park.

But my first appearance on TV turned out to be a rather nerve-racking experience! Let’s hope that was just because it was the first time, and let’s hope they invite me back again.

The other thing I hope is that the calls I made work out okay!

In the Eurostoxx 50 Futures I (rather nervously, with a waver in my voice) said that last weeks break of 3387 spelt trouble, especially since this level turned resistance and capped upside subsequently. This is a key line in the sand and if we can retake this level the hounds can be called off. Otherwise things still look very bleak.

In CME Group Wheat (still called CBOT Wheat by most people despite the recent merger) we’ve seen a failure at a key Fibonacci level (955) in recent days and this now looks set to head lower to retest the year’s low at 730 (trading 845 at the time of writing). I had managed to gather myself a bit by this time and was even starting to make some sense!.

Finally I looked at the Eurex Bund (by this time I was breathing normally and everything) where the short term has been a tad messy, but the Medium Term outlook remains firmly skewed towards the Bears.

Overall I think it went well, and I’m looking forward to the next time I get on there, and this time I’ll tell people beforehand. Today I was more than happy to keep it quiet!!!

Here’s a link if you want to view it…

http://www.cnbc.com/id/15840232?video=782776257

We spent Friday at the IX Investor show where there were many people that were looking into the idea of trading the markets using Spread Betting.

A question that often comes up is what to actually trade, when it comes to Indices like the FTSE and the Dow, because on most Spread betting platforms there are several choices of product.

The FTSE 100 Index (aka “the Footsie”)  tracks the country’s top 100 companies. As many of you may be aware this list changes depending on who’s doing well and who isn’t. This week Alliance and Leicester, Persimmon, Tate and Lyle and Home Retail Group all fell out of the FTSE 100. This is a reflection on how tough Banks, House Builders, Retailers and Food companies (respectively) are doing it right now.

So who replaced them? Fine British names like Petrofac and Ferrexpo joined Drax Power and Invensys.

Petro-who? I think I know what it does based on the name; and it sounds like it likes Oil at £139 a barrel! Petrofec is an Oil service company; a truly worldwide operation.

Ferrexpo is a Ukrainian mining company.

The FTSE 100 reads like a who’s who of international powerhouses these days, whereas 10 or 20 years ago it read like a who’s who of the British High Street.

Now here’s one thing to think about while we ponder the make-up of the Index: It always champions the strong and weeds out the weak.  If a company performs badly, or if they are in a struggling sector,  they can fall out of the Index.

It’s the mining companies that have been the stellar performers in recent years, and the FTSE is now chocker-block with them.  As the Banking Stocks continue to fall like lead balloons their effect on the overall index decreases. So what you’re trading when you buy and sell the FTSE 100 is very different to what you were trading even a couple of years ago.

But back to our initial concern: The different products on offer on the Spread Betters platforms.

Most firms seem to offer at least two choices, the main two being a rolling “Cash” product or the “Quarterly/Forward” contract.

The rolling/cash merely tracks the underlying Index and settles against where that finishes each night.

The “Quarterly” or “Forward”  is based on the FTSE 100 Futures and is, in my humble opinion, the best one to trade, especially if you want to use our daily reports!  We write our reports on the Futures contract, currently for expiry in September (it trades for delivery in September, December, March and June, by the way), and this is what most Spread Bet firms will be referencing their quotes from.

If you want to trade the daily rolling contracts you  would need to work out the difference between it and the Futures before you can make firm use of our levels. The Futures should trade at a premium to the underlying, and at the moment in the FTSE that’s about 28 points.

If you have any further questions feel free to contact us via the button in the Member’s Area. We always aim to help our Members get the most out of the service.

Happy trading.

Cheers,

Clive.

We have had our new website available for around 1 month now and we are starting to gain momentum for our new “per end user” offering. Private Investors, CFD and Spread Bet traders are starting to sign up and see the value of our service.

In recent days we’ve seen some interesting moves in the markets:

Gold Futures have turned over and after a plethora of sell signals yesterday we went Bearish this morning, just before the market sold off sharply.

Brent Crude Oil Futures has seen a big sell off but we’re certain this is merely a buying opportunity.

We have remained Bearish in the short term on Equity markets but our patience is being tested on this, particularly in the DAX Future, never one to willingly play the game!!

Interestingly today’s early high/failure in the S&P 500 Futures could be key and suggests that the market can head lower in the short term.

Login for a free trial to see our thoughts on these movements in more detail.

So to a question we’ve been asked a few times of late: Where did we appear from?

We have been servicing professional traders for 8 years now. The company formed in March 2000, soon after the closure of the LIFFE Floor. The traders who congregated on the LIFFE Floor headed up to different offices around this time, and suddenly they needed an edge, they needed information. I always had a string of traders who used to come and have a chat about the charts when I was based on the Floor, and so it was a natural progression to turn this into a daily commentary. I started by sending out a daily report on Bunds and T-Notes, and it grew from there. We grew with the Industry. Proprietary trading accounts for a good percentage of the daily Volume on exchanges like LIFFE and Eurex.

We wanted to expand our horizons beyond this arena, though, so it was a choice of Banks and Hedge Funds or Private/Retail Customers. Which way to jump!? We have found over the years that “bean counters” at the Institutions can cause problems for services like us, because they see a lot of free technical analysis being provided by the large brokers vying for their business. “Why pay for something that you can get for nothing?” -they say.

So we came up with the idea of a Members website where the reports can be viewed securely, on a “per end user” basis, which allows us to significantly reduce the price without upsetting our existing professional clients who pay for a “Site Licence” and the ability to distribute the reports amongst their traders.

We encourage you to take advantage of the chance to utilise this professional trading tool in your daily trading routine.