Jump to content

Trade of the Week starting 11 July: short Dow Jones

Recommended Posts

In this week’s Trade of the Week we look to go short the Dow Jones Industrial Average with a stop and reverse order at 31,510 and a downside target at 30,400. We also look at last week’s trade, which was long GBP/JPY.



 Axel Rudolph | Market Analyst, London | Publication date: Monday 11 July 2022 

Last week's trade: long GBP/JPY

Hello and welcome to this week's Trade of the Week for the week starting Monday 11th July.

Now, last week's Trade of the Week was a technical trade on the British pound against the Japanese yen. Little did we know the developments surrounding the Prime Minister, Boris Johnson, and him resigning with regards to the Tory Party leadership. All of this political turmoil led to our trade being stopped out.

And last week we went long the British pound against Japanese yen at ¥163.85 with a stop-loss below the previous week's low, just below here at ¥161.55. Unfortunately, we got stopped out and then the currency pair started to rise again.

So, for those of you who haven't been stopped out on this trade, there might still be a possibility to go back in at the previous level, where our trade was made last time around. And this time, what you would need to do if you wanted to go long here is basically put a stop-loss below last week's low at ¥160.40. So that was last week's Trade of the Week.

Trade of the Week: short Dow Jones

This week's Trade of the Week is to go short the Dow Jones Industrial Average, and there are several reasons for this.

First of all, we are quite worried in Europe that today's maintenance, which will last ten days, of the Nord Stream 1 pipeline, which is the largest pipeline pumping gas into Germany, might not be reopened by Russia after the 10-day maintenance period has ended. And therefore, this could obviously negatively impact the European economy and also European stocks.

And in the US, we have the start of the second quarter (Q2) earnings season with the large American investment bank, JPMorgan , reporting second quarter earnings on Thursday. And also, all throughout the week, we have sentiment, inflation and industrial production data out of the US.

So, all of this could have a negative impact on equity markets and therefore we want to go short on the Dow Jones Industrial Average at current levels at 31,185 with a stop and reverse order just in case we are wrong.

So we would not only stop our short position out, but also go long above last week's high at 31,510. And our downside target would be the previous week's low, just above there, let's say, at 30,400.

So this week's Trade of the Week is to go short the Dow Jones Industrial Average at 31,185 with a stop and reverse order at 31,510, and a downside target at 30,400.



trade of the week.PNG

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • General Statistics

    • Total Topics
    • Total Posts
    • Total Members
    • Most Online
      10/06/21 10:53

    Newest Member
    Joined 05/02/23 04:54
  • Posts

    • HI,  Please if any IG supporting staff can answer the questions below? 1. in the upcoming AMC/APE vote on 14 March 2023, can shareholder that hold AMC and APE at IG able to make a vote? I also have AMC and APE at IBKR and they did send out a notification to inform me that I can do proxy vote. Will IG do the same? 2. the upcoming vote is to determine APE covert back to AMC then do reverse spilt. Last year after APE issued, IG staff told me that they have to move APE to share dealing account from my ISA account as ISA is not eligible to hold APE (which is completely unbelivable, my APE at AJ Bell and HL are still sitting in ISA account). Anyway, if the conversion and reverse spilt is going to happen, will IG move my APE back to ISA account for the corporate action? Many Thanks
    • The epidemic in recent years has produced profound changes in people's lifestyles, and many of their activities have started to be developed in the virtual world, which plays an important role in promoting the development of the universe of meta. Games, as an important part of the universe of meta, will be the first industry to gain the benefits , but the following conditions are still indispensable for blockchain games to achieve better development.   - Wallets and Exchanges. Through the use of wallets, game users can truly take control of the assets in the game, and exchanges provide a trading platform and liquidity for these game assets NFT, helping users trade and revitalize their game assets. Wallets are a key application for depositing blockchain assets. Currently, wallets such as Metamask are not enough to support the extensive adoption of block games, and wallets will further advance community drive the popularity of blockchain games.  - Game playability. The biggest difference between blockchain games and traditional games is that gamers are also investors. Many blockchain games have gone out of course, treating all users as investors only and forgetting that the essence of making games is to develop high-quality games that users are interested in paying for. If most people play a game just to make money, and no one is ready to pay for it, it becomes a side-scam. The revenue of the participants of the side scam comes from the money of the people who come later, and if there are not enough people who come later, they will not be able to cash in the revenue, leading to the breakdown.  - Speed and performance. A high level of concurrency is the characteristic of game applications, so Wax, Coinan Chain and Polygon, which are public chains with a high level of concurrency and low fees, have attracted a large number of game developers. In the future, with the maturity of technologies such as Ethernet Layer 2 and slice scaling, as well as the maturity of other gaming public chain technologies compatible with EVM, blockchain games will have a better development and operation environment.  - Cross-chain and interaction. Cross-chain and interaction of game assets will be a direction of future development of metaverse games, and blockchain should be connected and accessible like the Internet. The maturity of cross-chain technology in the future will promote the cross-chain transfer of game assets and NFT, and improve the interaction experience of the system                                                                                     The game should maintain the operation of the project by relying on the payment of some users or selling profitable products, just like the new blockchain game Fairy Cat in 2023, which developed diverse gameplay for players and increased the playability of the game, thus got the recognition of many players. Blockchain games need to work hard on game experience and playability. Token economics is essentially just a kind of interest structure , and even good token economics cannot replace the development, operation and profitability of the project itself. It is believed that with the maturity of the above conditions, more and more game developers and investors will enter this industry and together promote the production of some blockchain games with beautiful graphics, first-class experience and high playability.
    • Hello, Is any interest paid on "available" cash (not "margin") in a spread betting account? For example, if I held £10k in an account and had no open positions. The reason for asking is that I understand that proceeds from short sales in a CFD will receive interest (benchmark-2.5%), so was wondering if that applied to all cash, and couldn't find an answer on the web site.   Thanks.
  • Create New...