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

With volatility up by factor of 5 may well be worth reducing leverage by factor of 5. 1 point is quite an exposure when dow can move 800 points in half an hour. s@p spreadbets are significantly lower in exposure. Many advise not risking 1.5% on a trade so 1 on S@p equates to approximately 100 per 1000 point dow move tolerable risk if holding overnight. Be careful out there as they used to say in Hill St Blues!

cynic
please be careful with your saudi contact/ barometer.
many barometers are lagging. hope it wont be so with yours.
6 months would be my guess and bottom falls out overnight.
total surprise and collapse.
please do take such a possible scenario into consideration in your business/cash flow plans etc.
im sure you have already considered this so apologies. sometimes reminders from
those that know nothing help keep us focused.
kindest regards
jkd

+250 start at least but I guess the acid test is whether it can hold. If it does then maybe we can see the start of new trading patterns. If it doesn't then I dread to think!

thanks jkd, your concern appreciated and we do indeed monitor very carefully .... though you may well be right about the time lag, this particular saudi client is exporting primarily (i think) into f/e so there is a double indicator.

we are also keeping an eye on our indian biz to see how or even if that is being affected ..... so far, not

I think many will tough things out until the bitter end, so it wouldn't surprise me to see a sudden sharpening of the downturn next year. Christmas will be a good indicator of the state of peoples finances. I know several people planning to cut back on food and restrict gifts just to children this year.

As for the current rally in equities I think I'll wait and see. If the volume is good and it holds up for several days then it might be a bottom. Somehow I think it's just a relief/oversold rally though and will turn around again before too long.

In my opinion.

Strawbs.

With the lack of liquidity, on-line trading appears to be finished. Selftrade appears to be working but I can't even get an on-line quote for XTA let alone anything else!

strawbs ..... re uk you may well be right, and also to be chary of today's rally .... however, the real key is whether or not international confidence can be restored, or at least, in the first instance, if the blind panic and fear can be halted

I think some parts of the world are still pretty flush with cash. Saudi and the major oil producers will still make money while there's demand, so no doubt they'll be slow to show any real signs of a slowdown. I'm not convinced that the BRICs countries will escape though. They've grown rapidly from Western outsourcing (services and production) and will surely go rapidly into reverse. I'm not convinced their home grown economies are mature enough yet to withstand a sudden collapse in Western demand. None of this will be quick though. We've seen equites have a long slow bleed from last years highs, with the occasional sudden drop for good measure. I suspect the pattern will continue until the floor in economic activity can be measured at least.

In my opinion.

Strawbs.

As ever, it depends on how Wall Street behaves.

DOW still looking good at +300. Interesting that there are no positive vibes from the usual posters here.

i'll let you know how positive i feel at 21:30!

I remain negative whilst the majority are positive, but I'll become positive when the majority are negative....

It's not the contrarian in me....

Not in my opinion anyway.

Strawbs.

perhaps with the violent fluctuations wwe have seen of late, you (Strawbs) have missed the point where everyone became negative - lol!

on a slightly more serious note, Nymex has currently plummeted to +/-$82, though this would have been considered terrifying no more than about a year ago ..... for no particularly good reason, i would expect to see that price recover to +/-$100 over the coming months, but even then, that will be taking some steam out of inflation which will also be helpful to many sectors of all markets

Inflation's the old problem....deflation's the risk now.....once the monetry printing presses start to roll....

I don't think everyones negative enough yet. No doubt we'll have some short term bounce, maybe lasting into the New Year. I still think equities will be lower by Q3 2009 though. Possibly with a lot more volatility in between too. I think I'll have at least 2 or 3 years to get back into the market before a sense of stability returns, and a new bull trend emerges.

In my opinion....or is it... :-)

Strawbs.

Just to say that the Dow is closed today.

Hey Strawbs, never seen you so indecisive! Must be a good sign for the market.

Unfortunately as a trader I don't have that luxury. On the other hand, if I'd done what my girlfriend suggested and put the money somewhere safe (no not a bank) then I could be living nicely on the interest rather than trying to catch that bloody knife.

:-) Yeah. My moneys been earning boring (but safe) interest for the best part of a year. I did put some back into the market in June/July. Mixed results, although managed to eek out a profit. All too volatile for me to invest at the moment though....

Strawbs.

Ah, DOW closed. Now I understand.

Dow closed today?????
who says so??????

Public Holiday in the U.S.