The Traders’s Journal

The Dow spent the day headed further below the channel, down 130 points at 11,348 As the Housing Starts news was very slightly better than predicted, the effect was muted, however the concerns that caused Monday’s decline still weakened the overall market. With no news out state side, early weakness may set the day’s direction as the reactionary buy back has yet to make itself felt. With only 650 points to go, three weak days may mean that our bank holiday break could herald the tipping point, when combined losses could see the key 10,700 level reached before the projected September up turn. Yesterday the FTSE closed down 129 points at 5,320. Today, ahead of Retail Sales figures on Thursday and our GDP out on Friday, we have the Bank of England minutes released at 9.30 British Summer Time, where the markets will be looking for the merest hint of either continued negativity or a glimpse of positivity to react to. Just as with the Dow - further falls could see the 5,100 level reached potentially triggering a fall away below the 5,000 level. Oil is trading at $115.00 and Gold at $819.30. Good trading and I will speak to you tomorrow.

The Dow bottomed out of its channel around noon (British Summer Time) and finished the day a further 60 odd points down having dropped overall by 180 points this decline was led largely by the banks and Real Estate shares with a few builders thrown in for good measure as speculation grew that the Government intends to bail out Freddie Mac and Fannie Mae. Today look for further selling at the pre-open and open particularly as yesterday’s market catalysts are the most likely to be negatively affected by today’s big news out at 1.30 pm (BST) timed with the pre-open, of Housing Starts. If worse than expected then the sell off could be quite rapid, then watch for a potential buy back as stop losses kick in. The FTSE yesterday dropped by 4 points to close at 5450 but remains still within the channel of the last five weeks. The small high-test bar created by the tussle of indecision throughout the day sets well for a negative reaction out of the channel’s bottom level should the aforementioned news, signal a drop in the US. Oil is trading at $112.85 a barrel and Gold at $805.00 for 100g. Good trading and I will speak to you tomorrow.

Traders Update from the Live Trading Floor in London….The Dow opened Friday with early strength but quickly reversed from the highs, however the index still closed the day with a gain of 44 points at 11659, and continues to move within the channel seeming to have increasing difficulty with the 50 moving average after Monday’s foray onto higher ground. Volumes are reaching a low ebb as August peters out, so today with no major market news, direction is likely to be choppy with slight overall upward movement ahead of news releases out later in the week. The NASDAQ and S&P each traded sideways throughout the day offering no lead or support to the DOW and continue within their respective ranges. However, these ranges, if broken could indicate early direction Monday. The FTSE closed down 42 points at 5454 similarly squeezed between the channel bottom and the 50 ema, so, just as with the above market, direction is likely to look to components for impetus.  Oil is at $113.77, the same level it was in April and gold is trading at $792.10. Have a good day’s trading a great day and I will speak with you tomorrow

Yesterday the Dow Jones index closed down at 11,642 below both the 50 moving average and the 11,700 mark. Whilst the bears had the day the channel is still in play and with retail sales reports at 1.30pm (British Summer Time) projected to move little from last month - a spot of bullishness is all that will be needed to ease the direction back above the current key level. The FTSE ended at 5534 down seven points, having broken through the 50 ema over the lunchtime period, but then gradually fell back to close below it. Today the sustained break of this important resistance level is the aim but with only minor market moving news out at 9.30 BST, indications are that there is little to carry it through and hold it in the short term. Have a great day of disciplined trading and I will talk to you tomorrow.

The false start of the Dow’s downtrend at the start of May took hold around the 20th and dragged the index down over two thousand points less than two months later. The apparent reversal of this trend has since faltered and initially channelled into a 800-900 point range, now this range is seeming to  be tightening and the price action has dived and rallied roughly between the11,600 and 11,100 levels. Seen on the day Chart the pattern forming suggests an ascending triangle. Should this occur and a breakout from resistance be the result at around the 11,600 line, it is unlikely to happen until around the second week of September when the Market is enthused with a resurgence of purpose and urgency as business focus returns to push forward toward the Christmas season peak in late October and early November. Yesterday the Dow Jones again opened to weakness and after a half-hearted attempt to right itself gave up to a lethargic close 42 points lower on the day. Not even the raft of economic news bursts of various kinds today caused much movement, as all was roughly in line with expectation. Today with little to stir this index again, as a whole, until 7.15pm (British Summer Time) when the Federal key interest rate is announced, watch for more indecision throughout the day, but be aware of the potential for volatile reaction at news time. The FTSE closed down at 5,320 by 34 points yesterday with little to show for the movements during the day that ranged over 100 points. Today with a number of indicators out at 9.30 (BST) reaction to them may well be muted ahead of speculation over the Dow’s reaction after this index has closed. Check the Dow movement in its last two hours for potential early direction on the FTSE tomorrow. Good Trading and speak to you Wednesday.

The Dow opened Friday with a continued decline. The index bottomed out just below 11,300 and proceeded to consolidate the rest of the day, ending the session with a loss of 52 points. The movement within the aforementioned range continues, therefore a range breakout is still what we are looking for decisive direction. At its close the FTSE was 57 points down at 5,354 and this week we look to further potential downward movement as the August doldrums take hold. Sideways movement over the days to come is indicated with even Bank of England interest rates unlikely to cause much of a stir this week. Oil is trading at $125.51 and Gold $921.60. Good trading and speak with you tomorrow.

The Dow opened yesterday with early strength, but was immediately sold to below the 11,600 level. The index dropped back toward the 11,400 level, but eventually rallied strongly towards the Close, ending the day 186 point up. There are indications that if the breakout occurs at either the top of 11,700 of the low of 11,200 then the resulting move could be significantly more than the daily gains and losses of late. The NASDAQ and S&P are both showing distinct signs of a similar breakout which will be a catalyst to the Dow. Today with the USA GDP announcement, out at 1.30pm (British Summer Time) a good day for decisive moves. The FTSE closed 101 point up also; at 5,420, so today early gains could be nullified by reversals caused if there is a negative response to the American news. Oil is $126.13 Gold $920.40. Have a good day Trading and speak to you tomorrow

Good morning on Monday the 28^th of July 2008, only a year ago the Dow was fighting with a support/resistance level of 13,700 and Oil was trading at $73.40 a barrel. Today The market will proceed from an end point of 11,370 after a very sideways day with a gain of only 21 points and still within the channel of recent weeks… with no major news today and the holiday season grinding up to full swing, another indecisive day of movement languishing in the aforementioned channel is likely, but some early selling proving the continued weakness, may kick the day off heading down. The FTSE closed just 10 points down at 5,352 at the end of the week and again with no major news unless decisive movement occurs early in the day this index is likely to meander towards a slightly higher close. Oil is $123.900 a barrel and Gold is $939.100 for 100g

Further to warning indications highlighted in previous editions The Dow opened the day with early weakness, the result being heavy selling that lasted throughout the day ending in a loss of 283 points. The possibility of the Dow testing below a 11,200 with more weakness potential is now looking likely. The NASDAQ and the S&P have both weakened further. Today with US news at 1.30 and 3 pm (British Summer Time) should these economic reports be worse than expected and be interpreted as indicators of further weakness to come, coupled with end of the week profit taking, could mean further substantial falls towards the close. The FTSE 100 index closed down 87 points at 5,362 having reached a low of 5,245. Today with all the indicators from the US, a down day is on the cards and the movement around our major news at 9.30 (BST) is expected to be muted as the likelihood for surprises on the figures is very low against those forecast. Gold is at $929.600 and Oil is at $126.230 Have a great weekend and see you Monday

Proving the underlying continued weakness of the American markets the Dow Jones flirted with an upward movement above the 11,500 level but then the index fell back towards 11,400 ending the day with a loss of 29 points. Today opening weakness is indicated followed by more indecisive movement. Watch Upper and lower levels around the recent formed channel points for breakouts but with little scheduled news to move the market as a whole, another oscillating day is likely. The FTSE closed 27 points up at 5404 down from the high of 5445 and a low of 5334. Today this index threatens more of the same undecided direction, with weakness at the core. Oil is trading at $130.53o per barrel and Gold is at $968.100 for 100g.