rather than pick out individual stocks to trade, it can often be worthwhile to trade the indices themselves, especially in times of high volatility.

for those so inclined, i attach below charts for FTSE and FTSE 250, though one might equally be tempted to trade Dow or S&P, which is significantly broader in its coverage, or even NASDAQ

for ease of reading, i have attached 1 year and 3 month charts in each instance

One for the watch list, either head and shoulders or about to break.

Wouldn't surprise me if we get a deal on the debt ceiling to see a sell-off on the news.

By Alen Mattich It's common wisdom that the U.K.'s coalition government has stifled growth through austerity. So much so it'd be easy to miss the fact that the U.K. has consistently run some of the biggest public sector deficits in the world since the financial crisis and continues to do so. In only one year since the end of 2007 has the U.K.'s deficit to GDP ratio been out of the top four among the International Monetary Fund's list of 35 developed countries. That exception was 2011, when the U.K. came in number six. This year, next year and in 2015, the U.K.'s deficit is forecast to be bigger as a proportion of gross domestic product than all but two of those 35 countries. Yes, but the deficits should have been even bigger to replace a shortfall in domestic demand triggered by the financial crisis, argue Keynesian economists. By reducing the public deficit even a small amount, the coalition government prolonged the downturn and ensured an even slower climb out of the trough, they conclude. On the flip side, those favoring austerity largely argued that had the government failed to signal clear resolve to take the deficit under control, Britain would have been hit by a crisis of confidence, capital flight and a consequent surge in market interest rates. In other words, the economic pain would have been worse. Cutting the deficit, they argue, was a matter of insuring against an even worse outcome. As it happens, the Keynesians were probably more right than the austerity advocates (with the caveat that real life macroeconomics seldom has useful counterfactuals). In retrospect, the insurance value of austerity was probably overstated for the first few years of crisis. But as the U.K.'s ranking in the deficit-to-GDP ratio league table shows, there was less austerity than is popularly believed. Much of the supposed deficit cutting was in fact little more than a promise to do so in future. Which is why the U.K. has continued to run large deficits. The U.K. government may well have been able to get away without cutting the deficit in the three or four years after the crisis as investors favored the U.K.'s relative safe haven status amid the euro-zone meltdown. But as the euro zone recovers, that charitable attitude is likely to change. If the U.K. continues to postpone serious deficit reduction, the country could yet be hit by the sort of crisis austerity-supporters warned about. This depends in part on how much of an output gap there still is in the U.K. economy and whether it could return to pre-crisis trend growth. Keynesians largely answer "a big one of around four percentage points of GDP, maybe even more" to the first question and "yes" to the second. But are reasons to believe the output gap is smaller and trend growth is lower than those advocating continued massive stimulus believe. In the years before the crisis, the U.K. benefited from a huge credit expansion and pro-cyclical growth in government spending. The Bank of England made little of a drop in unemployment to lows not seen in more than 30 years--in spite of mass concurrent migration from eastern Europe--even though there was no reason to believe the stable rate of unemployment had fallen. The BOE took stable inflation as a signal that the boom was sustainable. Never mind that price pressures were held in check by cheap Chinese imports--the U.K. experienced a long run of goods price deflation during the middle of the noughties. A post-crisis collapse in U.K. labor productivity and persistently above target inflation suggest the U.K.'s demand deficit is smaller than Keynesians suppose and that potential growth is much lower. If trend growth is 1% to 1.5% rather than the 2% to 2.5% officials suppose it to be, then actual 2% growth (the IMF expects the U.K. to achieve 1.4% growth this year and 1.9% next) will absorb that spare capacity very quickly. If productivity doesn't recover during that time, inflation will quickly start to pick up again. The Bank of England's reaction function shows it is willing to accept overshoots of its 2% consumer price target for long periods if it can convince itself there's a risk trying to slow inflation would prematurely slow the economy. In light of this monetary policy backdrop, backsliding by the government on deficit tightening--particularly in the run up to the 2015 election--could create just the sort of environment those advocating austerity back in 2010 warned against. Investors could quickly lose confidence in sterling and bonds would sell off. Then the Bank of England would be in a position of having to either drive the economy into a deep recession to regain investor confidence or allow inflation to gallop along, hoping something turns up to save the day. This is an opinion column by Alen Mattich, who has been a columnist for Dow Jones for more than a decade.

By Barbara Kollmeyer and Michael Kitchen U.S. stock-index futures pointed to a sharply lower open for Wall Street on Monday as Senate leaders remained deadlocked over a deal to raise the nation's debt limit, due to a clash over previously passed budget cuts known as the sequester. Futures for the Dow Jones Industrial Average slid 91 points, or 0.6%, to 15084, while those for the S&P 500 fell 11.30 points, or 0.7%, to 1687.70. Nasdaq futures traded down 14 points, or 0.4%, to 3211.50. With no economic data or major earnings on the calendar for Monday, which is also Columbus Day, investors were left to dwell on the weekend's political action, or inaction as some were seeing it. All three futures were off much sharper lows that came out of Asian trading hours, as news trickled out that Democratic Senate leaders were demanding that a debt-limit deal not lock in further sequester cuts. These are due to take effect next year. "With three days to go before the U.S. Treasury technically runs out of cash to pay the bills, traders are now fearing the worst-case default scenario being played out," said Ishaq Siddiqi, market strategist at ETX Capital said in a note. "Although many dismiss it as unlikely, with hopes that U.S. lawmakers will strike an 11th-hour deal, traders are showing reluctance to take risks as we head into the deadline on the 17th of October." The New York Times said that Democrats wanted the sequester, passed into law as part of the deal resolving the last debt-limit impasse, to last only through mid-November. The Wall Street Journal quoted Republican Senate leader Mitch McConnell as saying, "Senate Republicans will not accept anything that undoes these cuts." The latest snag to efforts for an agreement came as McConnell and Senate Majority Leader Harry Reid, a Democrat, negotiated Sunday, with just four days before the U.S. administration expects to run out of funds to meet its obligations. Much of the U.S. government remains shut down for the 13th day, with a bill to restore funding for operations seen as likely to feature in any deal. "The picture that is emerging is of the Democrats pressing their political advantage to secure further concessions, knowing that public opinion is turning sharply against the Republicans," said Alvin Tan, foreign exchange analyst at Societe Generale, in a note. "Nonetheless, given the Republicans' plummeting approval ratings, we remain confident that a deal on the debt ceiling will be reached before a Treasury default." International Monetary Fund Managing Director Christine Lagarde warned the combination of the U.S. shutdown, combined with a default on the debt would cause "massive disruption the world over," speaking in an interview on NBC News's "Meet the Press" that aired Sunday. Jan Hatzius, chief economist at Goldman Sachs, said the investment bank estimates real growth in the gross domestic product will see a 0.3 percentage point hit in the fourth quarter, based on the shutdown so far and mostly due to federal employee furloughs. In his comments, given in a note to investors published late Friday, he said the effect will be almost entirely reversed in the first quarter of 2014. In overseas markets, Europe stocks fell after the release of a weak batch of economic data out of China and as U.S. politicians struggled to make headway on a deal. In Asia, stocks fell for the same reasons. Exports from China fell 0.3% in September from the year-earlier period, marking the weakest performance in three months. Within other assets early Monday, December Comex gold futures rose nearly $7 to $1,274.90. The ICE dollar index--a measure of the greenback's strength against six rivals--was at 80.358, down from 80.375 late Friday in North America.

dow is a bit twitchy this morning
however, as it is 99.7% certain that a deal will indeed be struck, finding the long entry point is the question

Deal or No Deal I'm not going to go long on the DOW, I will however wait and play short when I'm ready.

May also go short GBP/USD, EUR/USD...

Yep - I'm short again (FTSE).

WSJ Washington Wire‏@WSJwashington5m
House could vote as soon as today on Senate deal with changes -- GOP lawmaker (1/2) #shutdown #debtceiling

Jake Sherman‏@JakeSherman13m
The vote on the HOUSE PLAN will be TONIGHT.

I'm rolling FTSE shorts Skinny from last week.

Shortie - I'm much the same - I got out of jail free yesterday morning when I reduced by 75% - have increased again today @6,565.

I also took a profit Sunday night when the FTSE dipped. Debated a further position also at 6560 but didn't as I'm happy with my current risk exposure.

Its quite blatant how one SB co quotes out of hours index numbers (compared to other company quotes) if you are in a position - especially when, as was the case yesterday morning - it moved down quite dramatically before the market opened.

At about 6614 I'll consider another short when the top of the range is hit.



The spread increases out of hours though!

GBP/USD 1HR

Yes - I know - but out of hours, comparing comapinies A & B quotes when you are short/long with A is quite obvious - I guess at the end of the day they are only bookies and can decide how they make the book.

DOW Daily


Sometimes out of hours numbers works to your advantage, other times they don't.

Shortie,

Your IT-Finance STC indi looks well dodgy to me. The plot certainly shouldn't look like that.

Shouldn't have included it on the above DOW daily.