Think Financial Markets - Excellence In Trading Financial Markets

Market Sentiment

It is essential that we have a general feeling of which direction our market may trade on any given day.

To achieve this it is necessary to be aware of how global markets have performed on the previous day as well as during the night.

We measure this sentiment by allocating points to certain global indicies to measure their strength or weakness.

We look firstly to The Dow Jones Index. This index is one of the world’s most influential and as such rates very highly in determining the daily sentiment.

We allocate between 2 pts plus or minus if the overnight movement is less than 50pts or 4pts if over 50pts

The next most important indicator is the SPI200 which is the futures contract covering the Australian markets top 200 stocks and trades almost 24hours per day.

We also allocate between 2 and 4 pts as per the Dow.

Then we add both the Nasdaq and the S&P 500 indicies from the U.S they are allocated points as follows

Nasdaq above /below 30 ,plus or minus 2pts or less than 30, 1pt

S&P 500 above /below 15, plus or minus 2pts or less than 15, 1pt

Next we add the FTSE 100 results from England and the NIKKEI 250 from Japan which are allocated 1pt for a plus or minus result.

The maximum points on our table are 14 and variations of this will gauge bullish or bearish sentiment.

Other very important overnight markets to be taken into consideration when trading the Australian market are firstly the strength or weakness in the Aussie dollar versus the US dollar and we rarely have a good day if the commodity markets have been sold down during the night.

Friday, February 17, 2012

Market Sentiment

Dow 123 = 4

Nasdaq 44 = 2

S&P 500 15 = 2

Ftse -7 = -1

Nikkei -22 = -1

Futures 40 = 2

Market Sentiment 8

Local shares look set to reclaim some of yesterday's losses after Wall Street rose on another round of good jobs and housing numbers and European investors welcomed news that Greece had moved closer to securing a second bailout.

Wednesday, February 15, 2012

Market Sentiment

Dow 4 =2

Nasdaq 1 = 1

S&P 500 -1 = -1

Ftse -6 = -1

Nikkei 53 =1

Futures -2 = -2

Market Sentiment 0

The Australian sharemarket looks set to open lower after further doubt were raised regarding Greece's bailout package and its ability to avoid default, and Moody's ratings cut on six European nations due to the euro zone crisis.

Tuesday, February 14, 2012

Market Sentiment

Dow 73 = 4

Nasdaq 28 = 1

S&P 500 9 = 1

Ftse 53 = 1

Nikkei 52 =1

Futures -2 = -2

Market Sentiment 6

The Australian sharemarket looks set to open flat despite a positive lead from Wall Street after Greek politicians approved tough austerity measures for their debt-stricken nation.

Monday, February 13, 2012

Market Sentiment

Dow -89 = -4

Nasdaq -23 =-1

S&P 500 -7 = -1

Ftse -43 = -1

Nikkei -55 = -1

Futures -19 = -2

Market Sentiment -10

The Australian sharemarket looks set to open almost half a per cent lower as jittery investors await the outcome of the Greek parliament's crucial vote on a €130 billion ($A160 billion) bailout deal to stave off bankruptcy.

Friday, February 10, 2012

Market Sentiment

Dow 7 = 2

Nasdaq 11 =1

S&P 500 2 = 1

Ftse 20 = 1

Nikkei -13 = -1

Futures 5 = 2

Market Sentiment 6

The Australian sharemarket looks set to open higher following positive moves on Wall Street and most European markets after Greek ministers tentatively agreed on austerity measures needed for a €130 billion ($A160 billion) bailout package.

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