Index trading, just some random thoughts

[Broadway]

Hey all,
I trade the SPI for fun, on a small number of contracts.
Just to state the obvious, we had a breakdown on bad jobs news on friday night, which looks like it could be the start of another run down.
It kind of formed a minor double bottom after the news, but im sure most will fade this and send it south on monday morning. Either that or it's going to be a very fast short covering rally.
Critical time for the spi on monday, because it will set the mood for europe and usa.

The start will be jumpy. I'll be watching bhp at 10am closely. I would wait for the morning trend to be well established before jumping on.

gl hf.

 

[Sean K]

I'll be watching the open pretty closely too and looking to short the index. I'm not sure if we will be setting the mood for Europe though. Maybe Hong Kong and Japan, but we're a bit of a blip I think. Looks like the volatility is going to be with us for a while yet. Wonder how much of the potentially bad news is factored in to the markets now? Seems everyone is sure there will be more sub prime damage, so some of the pain must be in the prices already....

 

[Broadway]

Well I found this morning a bit tricky. It gapped down from sat 0700 sycom as expected and then closed that minor gap fairly fast like it has the last few days.

It then had a little support at 6175 until 10:08am, it tried to go below that, but someone with 55 contracts went long and triggered a small rally back to the sycom close again.

When that small trend broke, I finally jumped on for a short.

We'll see how far this goes.

 

[Broadway]

I might introduce myself a bit more.
Im in Sydney and trade on mon/wed/fri, work p/t on tues/thurs.
Im on my P's, been monitoring the SPI for a few months only, and just started trading it.
Im using IB and sierra charts.
Reason im doing this blog is to improve my entry/exits by inviting more experienced traders to comment on my logic.
So please feel free to comment, and tell me if you think im making good/bad decisions.

cheers.

 

[Broadway]

Sometimes BHP volume can indicate to me a corner in the SPI. eg. The volume in BHP around 1105-1110am indicated the SPI reversal. The spi volume wasn't as strong as a signal.

And now there's a volume spike in the spi at 1245. I guess it's selling from the second morning trend from 1110-1245. Lunch now.

Gonna watch some rugby and NFL I taped from last night.

 

[Sean K]

I didn't get on this morning. I had to go out to a Peruvian 'baby shower'. Most interesting. :-(

 

[vishalt]

index trading is so much fun

i just long/short depending on the US reports, the Aussie200 is so easy to catch

 

[Broadway]

Gonna stick my neck out here.
Feels like too much positivity lately for not much reason.
Yesterdays 1630 close looks like a magnet.
Ill see what happens after 10.

 

[Broadway]

Vishalt, I was wondering if you could go into a little more detail about how you trade?
Are you saying that if the US is up, you will go long on open, or look for low of day and go long, or just look for very short term longs during the day's trading?

thx.

ps. BHP volume spike 1037. Southern trend might be over soon.

 

[Edwood]

hi Broadway can you post charts showing your entries & exits? might help in terms of people giving constructive feedback

 

[vishalt]

Broadway, I do it more specifically when a US report is out.

Say for example the other day when US employers added less jobs than expected, the market was quite till the report released, and once it did the Dow started getting hit.

The great thing is the Dow is so liquid and takes hours to go -200/-300 (it ended down -248 that day), and the Aussie200 which trades at that time lags, and its easy to catch on.

So basically - payrolls released, DJIA streams down slowly, the Aussie200 starts reversing to -10, I short with a 40 point stop-loss, the Aussie200 ends down 100 points at the close of a session, free $100 if you short 1 contract.

 

[Broadway]

thx vishalt.

And I see that report was released at 2230 sydney time, which means you dont have to stay up too late to catch those reports.

And I could have gone to bed and woken the next morning to exit when it started heading back up at 1100am. Or maybe trailed the stop.

I'll have to keep an eye on sites like this I guess.

http://www.bloomberg.com/markets/ecalendar/index.html

 

[vishalt]

yeah bloomberg economic calendar is key