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, December 20, 2012

Market Sentiment


Dow                                          -99      =  -4        

Nasdaq                                      -10     =  -1

S&P 500                                   -11      =  -1

Ftse                                           26        =  1       

Nikkei                                       237      =  1      

Futures                                     5          =  2

                                                               

Market Sentiment  -2     
                        

 Local bourses are set to open modestly higher, as positive data out of the US was countered by a lack of solid progress over fiscal cliff negotiations. The World Bank has raised its growth forecast for China for next year, with a growth rate of 8.4% in 2013, on the back of stimulus measures and infrastructure projects.

Wednesday, December 19, 2012

Market Sentiment


Dow                                          116      =  4        

Nasdaq                                      44       =  2

S&P 500                                    16      =  2 

Ftse                                           24      =  1       

Nikkei                                        94      =  1      

Futures                                     28      =  2

                                                               
Market Sentiment  12        
     
Local stocks are set to open markedly higher, based somewhat on blind optimism that negotiations between Obama and congressional leaders over the Fiscal cliff are nearing an agreement of sorts. China appears to be back in vogue as the RBA released its minutes from the previous policy meeting. According to the minutes, policymakers feel that the Australian job market will take about a year to revive but they were confident the Chinese economy has stabilised.

Tuesday, December 18, 2012

Market Sentiment


Dow                                          100      =  4        

Nasdaq                                      39       =  2

S&P 500                                    17      =  2 

Ftse                                           -10    =  -1       

Nikkei                                        91      =  1      

Futures                                     22      =  2

                                                               

Market Sentiment  10                            

 Local stocks are set to open higher, following positive reports from the ongoing negotiation between Obama and congressional leaders over the Fiscal cliff.

Monday, December 17, 2012

Market Sentiment


Dow                                          -36      =  -2        

Nasdaq                                     -21      =  -1

S&P 500                                    -6      =   -1

Ftse                                           -8       =  -1       

Nikkei                                       -5       =  -1      

Futures                                   -10      =  -2

                                                               


Market Sentiment  -8 
 
                  Local stocks are set to open slightly lower, following a softer end to the week for offshore bourses.          

 

Friday, December 14, 2012

Market Sentiment


Dow                                          -75      =  -4        

Nasdaq                                     -22      =  -1

S&P 500                                    -9      =   -1

Ftse                                           -16     =  -1       

Nikkei                                       161     =   1      

Futures                                       10    =  -2

                                                               

Market Sentiment  -8                             

 Local markets are set to open lower as jitters about the fiscal cliff once again rose to the surface. Good economic data stemming from the US in the way of better than expected employment figures is expected to plant the seeds for any resilience in the market today.

 

Thursday, December 13, 2012

Market Sentiment


Dow                                          -3      =  -2          

Nasdaq                                     -8      =  -1

S&P 500                                     1      =  1  

Ftse                                           21      =  1       

Nikkei                                       56      =  1      

Futures                                       2     =  2

                                                               

Market Sentiment  2                              

 
Local markets are set to open higher on the back of comments from Chairman Bernanke, who said that the bond buying program would continue until a substantial improvement in unemployment were to occur and would be modified appropriately if the effectiveness of the program declines.

Wednesday, December 12, 2012

Market Sentiment


Dow                                          78      =  4

Nasdaq                                     35      =  2

S&P 500                                     9      =  1  

Ftse                                            3      =  1       

Nikkei                                       -8      = -1      

Futures                                     17     =  2

                                                               

Market Sentiment  9                              

 
Australian equities are set for a strong start on the back of better than expected German economic data and revitalised efforts on the fiscal cliff front. On the local newswire, investors can expect to see market movements out of data releases from the ABS and Westpac's consumer sentiment index.

Tuesday, December 11, 2012

Market Sentiment


Dow                                          15      =  2

Nasdaq                                       9      =  1

S&P 500                                     0      =  0  

Ftse                                            7      =  1       

Nikkei                                        6      =  1      

Futures                                     11     =  2

                                                               

Market Sentiment  7   

                           

Local markets are looking for a positive start despite speculation that the notorious former Italian prime minister, Silvio Berlusconi could be a runner for his former post. On the local front, investors can expect market movements from the release of NAB's business confidence data.


 

 

Monday, December 10, 2012

Market Sentiment


Dow                                          81      =  4

Nasdaq                                    11      =  1

S&P 500                                     4      =  1  

Ftse                                           13      =  1       

Nikkei                                      -18      = -1      

Futures                                       6      =  2

                                                               

Market Sentiment  8   
                           
Better than expected jobs data coming from the US and signs of a strengthening Chinese economy will have positive impacts on the open of the local market today. On the local newsfeed, monthly housing finance numbers are expected today.