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Weather outlook for the FTSE

Reading price charts which may give you direction in the market using established TA methodology
DiamondEcho
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Re: Weather outlook for the FTSE

#108560

Postby DiamondEcho » January 7th, 2018, 4:38 pm

bulltraderpt wrote:Fortunately as a day trader I can mitigate risk on a daily basis, but am getting concerned as it does seem a little too focused on one direction currently. I am also left wondering if and when we do get a pull back, whether the algo's will eat orders and send the market's lower than they naturally should given the happenings of the flash crash of 2010, although, granted, things are supposed to be more 'managed' now... :roll:


Many markets take a time-out, halt trading for a period of time, if the market drops x% intra-day. Probably useful for participants to have a chance to revisit order books and algos etc. But IMU the LSE doesn't have such a protocol.

@FredB, agreed cryptos have the same kind feel of 'easy bonanza for the masses' that was seem during the .com era; the talk, hype, media coverage and so on are eerily similar. I wouldn't touch them with a barge-pole. But has anyone considered or have views on how, if at all, a crypto bust might impact mainstream stock-markets like the LSE?

FredBloggs
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Re: Weather outlook for the FTSE

#108561

Postby FredBloggs » January 7th, 2018, 4:40 pm

DiamondEcho wrote:Many markets take a time-out, halt trading for a period of time, if the market drops x% intra-day. Probably useful for participants to have a chance to revisit order books and algos etc. But IMU the LSE doesn't have such a protocol.

@FredB, agreed cryptos have the same kind feel of 'easy bonanza for the masses' that was seem during the .com era; the talk, hype, media coverage and so on are eerily similar. I wouldn't touch them with a barge-pole. But has anyone considered or have views on how, if at all, a crypto bust might impact mainstream stock-markets like the LSE?

To me, it is simply a matter of scale. When firms like Lehmans went bust it was all about scale and leverage. I think Crypto's could eventually have the same impact. But it may be on a much shorter timescale than we imagine.

DiamondEcho
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Re: Weather outlook for the FTSE

#108571

Postby DiamondEcho » January 7th, 2018, 5:02 pm

FredBloggs wrote:To me, it is simply a matter of scale. When firms like Lehmans went bust it was all about scale and leverage. I think Cryptos could eventually have the same impact. But it may be on a much shorter timescale than we imagine.

Looking into the tale of Lehmans again to refresh my memory - Lehman was big into sub-prime mortgages, and had a very leveraged balance sheet. Perhaps it was the combo of the two that did it for them. They were also active in mainstream markets, hence wider fall-out was triggered when they collapsed. https://www.investopedia.com/articles/e ... llapse.asp
Interesting to also see that on the same day Lehmans went under, Merrill Lynch [I prev. worked there] agreed to it's buy-out by Bank of America. Though by that time - 2008, I'd already been spat out from Merrill in c2003 with Lehmans having interviewed me at the time, declining my job application :lol:

Are cryptos mainstream enough at an institutional level to cause this kind of industry sector cross-infection? I'm not sure, most banks/brokers' views I've heard with suggest they won't trade them, or get seriously involved themselves outside of perhaps very small retail order flow. Reminds me a bit like private client banking and their mass aversion to taking on rich Soviet clients in the 90s during the break-up of the USSR. 'There might be a lot of money out there looking for a home and potential profits to be made. But the downsides for us in the longer term were unquantifiable, 'Know your customer' wasn't possible then in the newly ex-USSR states, and the risks possibly materially worse than any short-term profit opportunity.

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Re: Weather outlook for the FTSE

#108576

Postby FredBloggs » January 7th, 2018, 5:23 pm

I think we won't know what the fall out from the crypto bubble bursting will be until it happens. There are numerous things that have had an impact on seemingly uncorrelated assets. Whether the impact is short or long term or involves mainstream financial institutions we won't know till it happens. I remain sceptical of how a seemingly parallel monetary system can emerge without involving blue chip and central banking institutions being eventually involved. I am also sceptical of aggressive trading houses who declare no interest in crypto's.

As I have said before, things are as safe as houses till the day they are not. Everyone was happy with Madoff till he was caught. Crypto's will make Madoff look like kiddies toy currency.

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Re: Weather outlook for the FTSE

#109210

Postby bulltraderpt » January 10th, 2018, 12:26 pm

DiamondEcho wrote:
bulltraderpt wrote:Fortunately as a day trader I can mitigate risk on a daily basis, but am getting concerned as it does seem a little too focused on one direction currently. I am also left wondering if and when we do get a pull back, whether the algo's will eat orders and send the market's lower than they naturally should given the happenings of the flash crash of 2010, although, granted, things are supposed to be more 'managed' now... :roll:


Many markets take a time-out, halt trading for a period of time, if the market drops x% intra-day. Probably useful for participants to have a chance to revisit order books and algos etc. But IMU the LSE doesn't have such a protocol.

You could be right, however the algo's could be queuing up before the average retail punter gets a chance to participate, but, you never know it's not always like that but you do have to be quick and trade with imperfect information, but don't we always?

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Re: Weather outlook for the FTSE

#109910

Postby DiamondEcho » January 12th, 2018, 2:59 pm

Anyone know what triggered the mini flash-crash this pm?
Per Google Finance:
7780 at 13.25pm
7755 at 13.50
7782 at 14.50

A -25>+27 spike in 1hr25m is not 'normal', but I can't find any mention of it via Google etc etc.

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Re: Weather outlook for the FTSE

#109917

Postby BrummieDave » January 12th, 2018, 3:07 pm

I was watching the US Futures and the S&P and NASDAQ, but not so much the DOW showed the same -ve spike so I suspect the FTSE was following their lead.

What caused the US indices to wobble is probably the question.

DiamondEcho
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Re: Weather outlook for the FTSE

#109953

Postby DiamondEcho » January 12th, 2018, 4:45 pm

Ah ok, thanks. FWIW those indices + the small-cap Russell-2000 [RUT] all subsequently made new intra-day records this morning. Impressive for a Friday...


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