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

As I said on Friday (post 2704):

"Many I fear will pile in today, perhaps misguided in the belief that financials are now safe with short sellers gone. The problems remain though. If the falls are more about a lack of buyers, than a mass of short sellers, we could be about to see a final exhaustion of the bulls, before that big drop I've been expecting."

Tomorrow will be interesting.

(Still) In my opinion...

Strawbs.

only short of Dow, which i have now closed at a very tasty profit for the evening ... have actually opened a long with a reasonable stop in place, just in case all continues to tumble

looked to short SOLA, but not possible in either staright stock or ADRs, as has been the case for 2/3 weeks now

HC
funny how such tops and bottoms are called at strategic technical chart levels, yet never seem to be referred to or reasons explained.
go do some and see the reasons.
dyor
regards
jkd

Total loss of confidence atm.

Let's hope the Senate approves the proposals and quickly otherwise we are going to have total capitulation and a destoyed financial system.

Senate will assuredly do the necessary as they know the stakes .... however, as i posted earlier on HBOS thread (i think), there was "lemming delusion" that this massive bailout was the panacea for all ills ..... of course it isn't, but it's a good start towards stabilisation - or at least we all hope so ...... that does not mean there will not be some pretty hairy moments, rather like yesterday

Agreed but stabilisation is what we need and bloody quickly!

At least then the strong companies will survive and the weak will succumb. At the moment the baby has well and truly been thrown out of the bath water.

Is it better to have a high wobbling tower of finance, or a stable one in pieces at your feet? Sometimes the fastest route to stability is to let nature takes it's course. Just make sure your standing on the right side when the tower falls....

In my opinion.

Strawbs.

If the tower falls the pieces won't be at your feet, you'll be buried alive by them along with the rest of us!

Actually I was thinking of standing on top with a parachute.... :-)

Strawbs.

lol Look below!!

That's me holding on to your ankles ...

just shut Dow long at 11054 for small profit .... once the market decides where it is going, i may jump back in, but 11000 could easily be challenged at the opening

all over the place last night, closing with a sharp fall to around 10840, an important support level ..... however, interesting to note that o'night indications have pushed Dow up by 125 to 10970, so it will be interesting to see if that holds or even improves ..... Buffett's injection of $5bn into Goldman will certaily have helped sentiment

imo, last night's fall was ridiculous, presumably stoked by an irrational fear that the Senate will not pass the rescue package ...... they may make life difficult, but pass it they will!

Thanks for that analysis Cynic -quite agree. It was certainly a fun and choppy ride on the Dow towards the close last night!

They'll always find something to worry about Cynic. If the bailout doesn't happen then they'll worry about financials going pop, if it does happen they'll worry about the state of the dollar, oil, commodities, higher inflation etc. Market movements depend a lot on overall sentiment, and if sentiment is largely negative, then there's always a downside. Unless the markets can attract new money (which seems unlikely at the moment), they'll just move up and down on low volumes until sentiment (in the real world) improves.

In my opinion.

Strawbs.

thoroughly agree .... sentiment is everything so anything that is done to improve that, whether it is Mr B and his $5bn or US Congress/Senate hammering out a bailout plan (which they will assuredly do)

You keep saying that cynic. Whilst I agree, the Senate are making me very nervous that they may water it down to some extent or even refuse to ratify it.

We are on a bit of a precipice here.

Senate/Congress will give the Republic administration a very hard time for incompetence etc etc, but at the end of the day they will ratify the bailout in an acceptable format, but prob not until well after hours on Friday if not Sunday.

To refuse to ratify would be suicide and they know it!

If they don't pass it, then it won't be the end of the world. Things might be miserable for a decade (as in the 1930's), but the financial system won't collapse. Companies will go pop, banks will go pop, and the tax payer will no doubt end up protecting all our savings. World governments have no interest in seeing the financial system collapse. Every country is interlinked, if one falls they all fall. By constantly trying to avoid failure, governments keep stoking up problems for the future. One day they may create a problem too big to save. The ultimate moral hazzard maybe.

In my opinion.

Strawbs.

There will be political point scoring in the senate, but I can't for one moment imagine them not passing this. Lets just hope that the Banks have learnt this lesson, like they should have done in the early 1990s.

When it's passed there will be a bounce, the question is how to take advantage sell or hold.

For me I would sell and buy back on weakness.

IMO

I suspect they'll pass the bill in some form, now they've managed to scare everyone into thinking it's needed. Not sure which way things will go afterwards. In theory I suppose it should be bad for the dollar, so I guess gold, oil, and non dollar currencies should rise. Which I guess is inflationary for the U.S. The stock market presumably gets a pop from the removal of uncertainty, but not sure if that'll last long. It could take a few years for people to feel confident again that banks etc. are free from trouble, so maybe the markets will stagnate for a while.
Don't know really. The markets seems very unpredictable these days. They could just as easily plunge as go up on the news. Some smart analyst will no doubt make up a reason for whatever the market decides to do. It's often the mindset of the markets participants that's more important than the reality though.

The chart TA would suggest we're going to see lower prices at some point, but then all chart patterns can be proved right over a long enough time horizon.

In my opinion.

Strawbs.