IIFT Daily Note with Peter Brown

Total mayhem, but where now?

Posted by:  |  Time: 7:33 am  |  Topic:
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Yesterday was crazy. Not the sell off, it was the rally first that was crazy. Anyhow the moves were massive. This is why we have a stop loss at 2%. Markets can and do amazing things and yesterday was a perfect example. The price action was not a trading opportunity because the rally was unbelievable and the following crash was more vicious than expected. If you made money yesterday it was luck. If you broke even , good. If you lost more than 2% you have learned a lesson.

So to today! God knows is the answer. We have broken through all levels so the technicals are not much help. The outcome of the Italian election is definately Euro negative. No one to impliment the austerity. The ECB won’t like this. What will Spain think? Lots of questions and uncertainty.

So trading today is a game of finding support or just selling. Hard to sell at these levels so a small trade at support might be the play.

Euro 1.3000 is going to be the first major level. S&P 1480  these are very tentative. Might be better to wait a few hours to find the mood and go with that. These markets look attractive because of the massive points they are moving but in reality they are not good for making profits. Be careful, give yourself a 75 to 100 point budget to trade with but stop if you lose it.

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