Think Financial Markets - Excellence In Trading Financial Markets

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.


Thursday, May 24, 2007

May 24 2007 First Post

Hi This is the first post, welcome.

I hope to bring you general comments, views and experiences, that you will find informative or useful as this blog grows.

I am new to this blogging stuff and amazed with the technology that even I can use.

The Australian market is down today following a weak lead from US markets, so I have time to play with this new toy.

ETO option expiry today seems to be creating some "balancing" in big line stocks after good runs.

All for now
Posted by at

3 comments:

Taurus said...

I take it this is the second comment! Interesting blog site!

May 24, 2007 at 12:56 PM
Anonymous said...

Anthony I would appreciate it if you could explain to me how to set a stoploss. I am trading with Commsec and the lack of the stoploss cost me a profit recently! Not the last Post>

May 24, 2007 at 8:37 PM
Anthony - CEO Think Financial said...

Hi, sorry note sure who I am talking to, message has come up with "toad" in the "comment from" box.

My experience with Commsec stop loss set up is that you put in a trigger price, then a "limit price" at which to sell.

for example if you want to sell on a fall below $2.50, would would enter it as "if xyz trades at equal to or less than $2.50, then sell at $2.50, if there is a buyer at $2.50 your order should be completed.

Hope this helps, if you require any further help please come back to me

May 24, 2007 at 9:17 PM

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