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

RIO
not sure that this is the right time to get back into RIO as it may have another 300 to fall to reach real support, or the same amount to rise for a breakout

It's easy to read too much into the Baltic Dry Index. A single capesize becoming available or going into dry dock can affect rates considerably short-term. Also bear in mind that it takes 4 or 5 years to get a big ship into the water from point of order.

The BDI is a proxy for Chinese demand, and there are other economic indicators at the moment which suggest that all is not well in China. Although HSBC/Markit jumped last month, it's still below the 50 line which marks the difference between expansion and contraction.

I'm not saying that we're not coming out of recession and that the BDI won't continue to climb in the months ahead, but it's worth bearing in mind that it's still down about 50% over the year as a whole.

EU, IMF clash over Greece revives debt crisis fears

BRUSSELS | Tue Nov 13, 2012 1:20pm GMT

(Reuters) - A public clash between Greece's international lenders over how Athens can bring its debts down to a sustainable level has reignited fears that the crisis could flare up anew.

Euro zone finance ministers suggested that Greece, where the euro zone debt crisis began, should be given until 2022 to lower its debt to GDP ratio to 120 percent but International Monetary Fund chief Christine Lagarde insisted the existing target of 2020 should remain.

hilary - many thanks your input ..... however, i am given to understand that BDI has improved by 50% from its low point, which in no way contradicts your own analysis of it ..... i would also concur that BDI is a prime indicator of China's economic health ..... that said, our own direct involvement with chemicals (we don't do the shipping) shows that demand in F/E remains strong, but India is dometsically weak, perhaps due to its currency problems

You're right, cynic, it has risen about 50% from its lows. Twice this year its been down to between 650 and 700 which is a level it's historically bounced from, and the index currently stands at around 1k representing the 50% you refer to. I presume the index rises from the 650/700 level simply because the shipping companies can't hire crew and buy fuel for any less than that.

But, when you look at the chart going back over the last 10 years or so, things still aren't exactly what I'd call pretty.

that's a fun chart :-)
i confess i never look at BDI, but it was something brought to my attention a couple of weeks back

I wonder what the combined operating costs of vessels, fuel and crews are, this would indicate where the BDI bottom is before a reduction in supply...

i've no idea, but at the end of the day, it's a supply and demand thing and not really anything to do with cost

on a different matter altogether, i keep seeing little snippets that the republican senators and congressmen have been told by their grandees to be rather mare pragmatic in their approach to the upcoming budget discussions

let's hope that is so, for though tough bargaining with reason and alternative views are perfectly acceptable, partisan obstructivism(??) for the sake of it is not

dow is certainly behaving as the charts indicated it should ..... let's hope it can continue for a while yet ..... i suspect 13000 is the next serious test on the way north

We'll see, I think it'll struggle to hold above 12800 at the moment, if we're to see any push come it'll need to establish support here first.

As Skinneys chart shows, 4 inverted candles at 12800, a star today would be a positive sign or a Harami tomorrow. No new positions opened this week on indicies or currencies, lets hope theirs some direction tomorrow.

i would acknowledge some minor resistance at 12900, but with volatility inevitable for the next couple of months, it's probably more a case of judging the direction of the short-term momentum

what a very disappointing end to the day .... had hoped to see dow finish comfortably ahead, but disconcertingly lower instead

Cisco ahead of expectations.

that cash DOW has recovered 70 pts o'night goes to show what very difficult and unpredictable times we are in

I totally messed up yesterday - my own fault for not sticking to my rules! So now I'm sitting on the sidelines for a bit.

I would beware of a possible fall later today, with the demonstrations going on in Euroland

I wasn't surprised to see the DOW give up gains yesterday, some figures expected today as per the below, forecast, previous...

13:30 PPI m/m 0.20% 1.10%
13:30 Core Retail Sales m/m 0.30% 1.10%
13:30 Retail Sales m/m 0.00% 1.10%
13:30 Core PPI m/m 0.20% 0.00%
15:00 Business Inventories m/m 0.40% 0.60%
19:00 FOMC Meeting Minutes

GBP Claimant Count Change 10.1K consensus -0.5K previous -4.0K

GBP Unemployment Rate 7.8% consensus 7.9% previous 7.9%


Merv the swerve speaks @10:30