That was The Week ending 27th Oct

FTSE This Week  – DOWN!  :  Monday- Friday  Tiny Loss 18 .  One down day does not a bear market make

Daily Volatility:11.895-9.43  from 11 – 9.13 slightly larger range again,and still about 50% lower than ‘ normal ‘

FTSE cash index – open 7523  high 7542 low 7437 close 7505

FTSE volatility-   9.8-10.26   (last week: open 9.13 close 9.8) 

What Trades Would Have Done well

TRADE 53 

This trade went from a debit of 5 to a reasonably decent  profit as it hit 12 on Monday. Short 7500 call,  long 3×7600 call– premium went to 30 from 14×3 =credit 12(from 61 and 22×3  = debit 5).

This is the kind of trade that you leave a limit order in to close out,and I’d be happy to get 10, or double my money. Of course commissions are a consideration, but consider this scenario: Your car breaks down on the way to a business meeting that could make you a quick £2,000 profit. Would you pay £500 for the cost of repair to get there? Of course*. Trading costs are inevitable. Spreadbetting has costs built in with the spreads-you typically take a 20% haircut. You buy at the offer and sell on the bid.

*Uber is not around in this situation! The car is an essential part of the deal

SUMMARY

We saw a>1% drop on Wednesday, late afternoon I missed it,and it cost me ££££££. I hope others capitalised on it. Thursday morning presented opportunities, but nothing that this trader really liked. These down days rarely arrive on their own, you typically get 2 down days together. This unusual action may presage something more helful .              Here’s the FTSE inverted, and normal. I drew the line to show resistance. In the inverted chart reading R to L it clearly shows support. The esteemed David Linton inverts charts to remove bias. What do you think? Have we hit a brick wall?