Think Financial Markets - Excellence In Trading Financial Markets: October 2011

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.

Monday, October 31, 2011

Market Sentiment

Dow 23 = 2

Nasdaq -1 =-1

S&P 500 1 = 1

Ftse -12 =-1

Nikkei 124 =1

Futures 13 =2

Market Sentiment 4

The Australian sharemarket is expected to open marginally in the black but Qantas Airways Ltd shares should come under pressure as investors lose patience with the airline's bitter industrial relations dispute.

Friday, October 28, 2011

Market Sentiment

Dow 339 = 4

Nasdaq 88 =2

S&P 500 43 = 2

Ftse 161 =1

Nikkei 81 =1

Futures 59 =4

Market Sentiment 14

The Australian sharemarket looks set to open higher following a positive lead from Wall Street and the European markets after leaders there announced a plan to tackle the Eurozone debt crisis.

Thursday, October 27, 2011

Market Sentiment

Dow 162 = 4

Nasdaq 12 =1

S&P 500 13 = 1

Ftse 28 =1

Nikkei -13 =-1

Futures 27 =2

Market Sentiment 8

The Australian sharemarket looks set to open higher following Wall Street's trading more than one per cent higher and after local shares rose on Wednesday.

Wednesday, October 26, 2011

Market Sentiment

Dow -207 =- 4

Nasdaq -61 =- 2

S&P 500 -25 =- 2

Ftse -23 =-1

Nikkei -82 =-1

Futures -37 =-2

Market Sentiment -12

The Australian market is set to open lower due to doubts European leaders will agree on a package to resolve Europe's escalating debt crisis.

Wall Street and European markets fell overnight due to reports key parts of the rescue package may not be ready in time for a leaders' summit on Wednesday in Europe.

Tuesday, October 25, 2011

Market Sentiment

Dow 104 = 4

Nasdaq 62 = 2

S&P 500 16 = 2

Ftse 59 =1

Nikkei 165 =1

Futures 32 =2

Market Sentiment 12

The Australian market looks set to open higher, after Wall Street and London traded more than one per cent higher overnight.

Monday, October 24, 2011

Market Sentiment

Dow 267 = 4

Nasdaq 39 = 2

S&P 500 23 = 2

Ftse 104 =1

Nikkei -3 =-1

Futures 45 =2

Market Sentiment 10

The Australian sharemarket looks set to open higher after a strong positive close on Wall Street on Friday..

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