Caseynotes

After the strong US session all are flying bull flags with clear breakout levels. Pre-open breakout box for Dax between 11623 and 11662 and for Ftse I would use the range between 7134 and 7145 with noted resistance at 7154.

@Mercury, for me the definition of Risk management is simple, it is the risk you take when entering a trade and that is the stop loss, the size of your stop times your position size is the risk. Money management is where I clump everything else, amount of account risked on each trade, amount of account at risk in all active trades and the amount being risked to hold a trade open. For exits, I may use a target if price is refusing at a significant level or otherwise I will either just trail a long at the most recent higher low or I might use a stepwise ATR, both are very similar in any case.

On the daily charts and with the elections out of the way and Trump with an increased majority in the senate (though losing the house) Dow happily striding out to challenge the all time highs. Despite a strong start this morning Dax and Ftse failed at the first hurdle and now contemplating a second attempt.

I've seen these new daily IG/Investor Chronicle podcasts flagged up on twitter a couple of times but can't find any link to them from the IG page, only the IC web sight. Short but interesting. Today's is on the bond market. https://www.investorschronicle.co.uk/sponsored/2018/11/06/paid-post-the-outlook-for-bonds/?CHID=9&SM=TW&REF=IG

Dow pauses at the prior high, will be looking for continuation upward for Dow, Dax and Ftse now the main election news is out of the way. Dax targeting 11690.

Dow tentatively nudges up to prior resistance on the US close to sit and watch the midterms. Nikkei could also break upward while Dax and Ftse have some ground to make up.

GBP up Ftse down on a hand gesture from MP. Ftse losing the support level it has hung onto all week. https://www.bloomberg.com/news/articles/2018-11-06/pound-now-moves-on-a-simple-thumbs-up-amid-brexit-optimism?utm_campaign=socialflow-organic&utm_content=business&utm_medium=social&utm_source=twitter&cmpid=socialflow-twitter-business

Dax push down through yesterday's low and retesting the break at the mo.

Nikkei could be leading the way with a persistent grind upward during the apac session.

Oh ok, that surprised me, so lumbered into such a deep sleep by Dax today I failed to notice the others were being somewhat more interesting. Ftse yoyoing on Brexit deal news, Dow grinding higher with Nikkei trying to follow, US non manu had another excellent 60+ PMI today. The US economy continues to roar.

After being spoofed on Friday the markets are not reacting to president XI's statement last night that China will further cut import tariffs, that's well on the way to a new trade deal with the US. MSM doesn't seem to have picked up on that part of the speech, just that China sees the benefits of more open economy. https://www.cnbc.com/2018/11/05/asia-markets-us-china-relations-currencies-oil-in-focus.html

The major upset is if Democrats take the 2 extra seats needed to take control of the Senate. Voters on Tuesday will elect all 435 members to the US House of Representatives (the lower house), but only 34 members to the Senate, there are 100 Senate seats but only 34 are up for grabs this time round. I'm suspecting GOP will retain both the upper house and the lower house. The Dems have wheeled out the 'big gun' Obama but he is filling high school gyms while Trump is filling stadiums. But you never can tell with elections, this is why the EU has disposed of them.

Start the week with the weekly charts, all the indices managed to put in a good bullish bar last week pulling back against the prior 4 weeks of downturn and may be now looking to move forward and retest highs. The prospective fly in the ointment this coming week are the US mid-term elections Tuesday, Republicans expected to hold the Senate but the lower House of Representative is in doubt. Any kind of major upset will throw the markets.

Hi Mat, see link to previous thread on this topic;

So just to see though to the end of day and a study of how price works. In my first post of the day is the story that drove price up, at 12 pm half an hour before NFP the story was denounced and so the driver of the price move was removed and as stated just above price needed to correct and headed back down, paused for a while to consider the good NFP figures then continued down, over corrected (see Dow) and then returned to the days starting point. Great fun.

I'm looking for price to move between zones of sideways movement, or levels, which it will do once all the buyers or sellers have been cleared out so it's very much Wykcoff (and very much TA but of a very basic nature). Once a level has been rejected price will move on so looking to buy the first pullback or failing that the break through of the high at the start of the pullback. Candle patterns or single bars in the appropriate position on the chart are the entry signal (such as the engulfing break through candle in my example) and stops go behind the entry pattern (or bar) and are trailed up at new higher lows. Price may be intercepted before it gets to an old chart level by urgent sellers moving down to meet it and that will cause the candles (and MA) to go horizontal again so a new zone is formed, from there it's just wait until buyers or sellers are cleared out again and on to the next level, where ever and whichever direction that may be.

(Sorry about hijacking this thread) Simulators are the best place to learn as you get a lot of practice and can run a lot of methods/strategies quickly getting a full report on each. I can show an example in this trade I took this morning, it didn't actually work out, but it will serve a purpose. The 1 hour and 15 min charts showed a strong move up starting around 4 am on news. The chart is the 1 min Dax, the 240 LWMA shows the strong trend so it's either buying pullbacks or breakouts. The pullback far left was too early for me but picture perfect. The next opportunity was the break of the previous high on the close of the engulfing bar arrowed with a stop underneath. The trade went sideways till a spike up around 7:30. Thought about bailing out there but the moves recently had been so strong so I moved the stop to beneath the spike bar (second red line middle of chart) and hoped to see a channel up but got a channel down instead to stop out above breakeven (red cross). After that the chart structure fell apart and the MA went horizontal heading towards NFP. So not complicated at all but all the pieces need to come together in the right place at the right time. It's also about feeling the flow and energy and the urgency as the candles are being laid down, you can just feel a move coming on but it takes practice.

Well that NFP was a load of hoo haa. About 30 min before the release a Washington official was said to have claimed the reports of a trade deal being drawn up were false and Dow immediately tried to correct back down but then the strong jobs figure gave it pause for thought and it still hasn't decided which way to go yet.

A 'part' of trading yes, but TA is not trading. TA is about making predictions based on past behaviour. Most TA is pretty basic and not difficult to learn and understand, the problem is that any predictions they hint at still only have a 50/50 chance of success. It doesn't matter how much TA you apply or how often you update it. Price action is live and constantly reflecting new information and correcting, constantly giving signals as to what it is trying to do. No reason why you can't have TA on a chart but trading is understanding the signals and responding accordingly in a timely fashion regardless of what the TA says. That skill is best learnt on a simulator, it's a skill you can't learn from TA.

Oh dear, so much for those profits ...

No, it's no 'trick' @Mercury, the ability to execute is a skill to be learnt. Most overlook this basic fact because they are too busy fussing over indicators and re-drawing lines on charts. Trying to predict the future with projections is 50/50 gambling. The skill needed is how to execute trades, you improve a skill by practice so practicing trading is the route to take and far more important than spending time producing endless elaborate possibilities on charts. Most people's time would be far better spent actually learning how to trade by practicing on a simulator.

Latest production figures, at highest levels for 2 years. Saudi and UAE really out doing themselves.

Quite right @Mercury, researched journalistic type projections and technical analysis projections can never be more than a best guess and many realise too late that they are a double edged sword and if relied upon too much can destroy an account at lighting speed. The more important point is that neither are actual trading, just adjuncts to trading that may or may not be of a benefit each and any time they are applied. The ability to execute will always outweigh the uncertainty of trying to predict and so that is what people should be spending their time learning.

Actually Warren Buffett does make pronouncements and I'm pretty sure the many who maybe somewhat over reliant on TA won't actually want to see them. For the very brave here's a sample below;

Another surge in the indices, this time caused by reports that Trump orders new trade deal papers between US and China to be drawn up for signing at the G20 meeting. https://www.bnnbloomberg.ca/trump-asks-cabinet-to-draft-possible-trade-deal-with-xi-1.1162200