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18 September 2017: Mixed Messages with Hedgefund Trades

There are some of the usual inconstancies in the Commitments of Traders reports when it comes to the stock market indices.

Comparing the Long:Short ratios of the last three weekly reports:
  • trending_upHedge funds are getting longer of the Dow. There are now about 8 longs for every short.
  • trending_downAt the same time, the funds are getting shorter of the S&P 500. There are now nearly 3 shorts for every long trade.
That’s quite a big difference for not dissimilar markets.


The Forex Data is Less Conflicting
In the forex markets, the funds have been holding similar positions for the last 3 weeks e.g.
  • chevron_right~ 2:1 long of euro vs dollar
  • chevron_right~ 1:2 short of sterling vs dollar
  • chevron_right~ 2:5 short of yen vs dollar (yes that’s how the COT reports on the yen, not dollar vs yen)
  • chevron_right~ 1:1 level on the Swissie, i.e. an equal number of longs and shorts on the Swiss franc vs dollar
  • chevron_right~ 1:1 level on the US dollar index
If you’re spread betting on GBPUSD or EURGBP then note that the last COT report was for the week to Tuesday 12 September and that was before the more hawkish Bank of England meeting on Thursday 14 September.

(The new report only comes out late on Fridays – so there is a delay but the COT reports still give some useful data.)


Commitments of Traders Long:Short Ratios
COT – Indices 29 Aug 2017 5 Sep 2017 12 Sep 2017
Dow Jones Index 7.6:1 6.9:1 8.1:1
S&P 500 Index 1:2.3 1:2.2 1:2.8
Nikkei 225 Index 3.2:1 3.8:1 3.7:1
COT – Forex 29 Aug 2017 5 Sep 2017 12 Sep 2017
Euro 1.8:1 2:1 1.8:1
Sterling 1:1.9 1:2 1:1.7
Japanese Yen 1:2.6 1:2.5 1:2.4
Swiss Franc 1:1.1 1:1.2 1:1.1
Australian Dollar 2.9:1 2.7:1 2.6:1
Brazilian Real 2.2:1 2.4:1 2.1:1
Canadian Dollar 2.6:1 2.3:1 2.2:1
Mexican Peso 3.5:1 5.1:1 5.5:1
New Zealand Dollar 2.8:1 2.2:1 2:1
Russian Ruble 1:1 1.1:1 1.7:1
US Dollar Index 1:1.1 1:1.1 1:1.1
COT – Commodities 29 Aug 2017 5 Sep 2017 12 Sep 2017
Gold 3.6:1 3.7:1 3.6:1
Silver 2.4:1 3:1 3.8:1
Copper Grade #1 1.4:1 1.4:1 1.4:1
Crude Oil (US Light Sweet) 2.2:1 2.3:1 2.3:1
Natural Gas 1:1.1 1:1.1 1:1.1



15 September 2017: Typical, You Write a Little Article About Range Trading

…and the market breaks out before you can test the theory.

The FTSE 100 has well and truly cleared the range we discussed.

At least it cleared the range so quickly that we didn’t have time to buy.


Also in the markets:

14 September 2017: EUR/USD Was Too Tempting

The main news today is about the rise of GBP/USD but I’ve had a small buy of EUR/USD which is near the up-channel support, i.e. the trend that’s been in play for most of 2017.

Here’s the set-up for my EUR/USD spread bet.




14 September 2017: Fresh Warnings on Why You Shouldn’t Spread Bet on Bitcoin

…or any other cryptocurrencies.

It’s been a poor fortnight for Bitcoin… it has fallen 24.4% in just 11 days.

As well as our tweets, which have warned about BTC and other cryptocurrencies, on 4 September we wrote a lengthy article on why you shouldn’t spread bet on Bitcoin.

Jamie Dimon, the JPMorgan CEO, has now also come out and said Bitcoin is a fraud. His comments helped knock 10% off Bitcoin in a single day.

It doesn’t matter if you respect Dimon’s opinion or not. The fact he can so easily move a market shows how fragile and dangerous it is for investors.

For more, also see Don’t Say We Didn’t Warn You.

Bitcoin Chart: August - September 2017
That sound you can hear… it’s the big f*** off alarm bell.


13 September 2017: GBP/USD Wheezes to 1 Year High

Well that was hard work. GBP/USD seems to have had an asthmatic rise to $1.33.



No Trade Yet But…
To me the rise has been weak and largely based on dollar-weakness. That means this is not a trend I want to join yet.

A quick breach of $1.35 could make things more interesting.

The EUR/USD chart is still the more interesting chart.

EUR/USD seems to be in a stronger trend due a combination of dollar-weakness and euro-strength.

It will be tempting to buy the market if the price comes close to the up-channel support line.



13 September 2017: Extreme Apple Bobbing

We did warn you it was going to be a volatile session for Apple.

Looking at the 10 minute chart below you can see the stock easily moving 100 points in just 10 minutes.

And it wasn’t all in one direction. You can also see a 400pt during one 60 minute period.

These kinds of moves sound great but are very difficult to trade unless you have very deep pockets or are willing to gamble with lots of trades and tight stops…. easier said than done.

I sure some traders made money but many will have gotten hurt… hopefully this serves as another reminder of why you need to be very wary of US tech stocks.



Why Did The Share Price Fall?
The product launch went as expected with the new iPhone 8, iPhone X and Apple Watch that doesn’t require an iPhone… and Apple still not discussing sales numbers of the watch.

The hefty $999 price tag for a new IPhone hasn’t had as much bad press as one might expect.

The share price fall seemed to coincide with the news that production delays mean consumers may not be able to shell out for a new phone until November.


Aftershocks Expected…
There could be more aftershocks for the Apple share price today. You have been warned.


13 September 2017: FCA Bearish on Initial Coin Offerings

The UK regulator has issued a rather stark statement on ICOs saying:

ICOs are very high-risk, speculative investments.

You should be conscious of the risks involved… and prepared to lose your entire stake.
Given the lack of oversight with ICOs, the FCA could have used even stronger language and still been correct.


12 September 2017: Trump Has No Connections with Russia…

There are many things that seem to connect Trump with Russia… something that the President adamantly denies…

In case you missed it here’s a 5 minute look at just one of the alleged ties… a tie which Donald Trump’s lawyer recently confirmed to Congress.

You know… the letter of intent The Donald signed to build a tower in Moscow…. You know the small matter of potentially creating the world’s tallest building…

And there’s more… enjoy 5 minutes of Trevor Noah:



12 September 2017: Take Care with New iPhone Launch

With the new iPhone launch, we could be looking at a couple of big trading sessions for Apple Inc.

This stock can easily move +500pts in a session.

  • warningThere was even a 914pt drop on 9 June.
Even with small stakes that kind of move should make you think again (and again and again) before trading.

See – take care when spread betting on Apple.


12 September 2017: FTSE 100 Presents an Opportunity

Yesterday:


12 September 2017: Gold Gives 464pt Profit!

  • starWow. There you have it.
Gold perfectly broke out of the triangle pattern we discussed and hit our Limit Order (Take Profit order) at $1,335.

Long-Term Gold Triangle Pattern: 11 September 2017

Do not be fooled. Trading is rarely this easy.

464pt trades are as rare as hen’s teeth and we did set ourselves a potential 236pt downside.

For more on this see textbook gold spread bet.


11 September 2017: Normal Service Resuming?

The VIX closed last week at 12.1 so neither exciting nor deadly dull either. Unlike the weather, the summer’s trading wasn’t a complete washout.

With the kids back at school we should also get back to normal September trading levels in no time.

Hopefully that means fewer random moves on light volumes.

Looking ahead, the AA PLC chart is showing an interesting pattern but no trade yet.

The big one though is this week’s new iPhone 8 / iPhone X launch and how that will impact the Apple share price.

Damp squib?


11 September 2017: IG No Longer Offer Discounted Rollovers

IG are no longer offering discounted rollovers on futures markets.

I.e. if you roll a futures trade over from one month (or quarter) to the next then you pay the full price of closing the trade to the mid-point (half the spread) and the full price of opening the new trade (whole spread).

With most platforms, you simply pay half the spread of the market to rollover a futures trade.

OK, this doesn’t feel like great news but at the same time this probably impacts less than 0.1% of all trades… or perhaps even less than 0.01%…

It’s not a big issue for most of us.

And if you are constantly holding these longer-term trades then think about using a different vehicle e.g. an ETF might be better suited to your needs than a spread bet.


11 September 2017: China Planning to Shut Bitcoin Exchanges

More downward pressure and extreme volatility expected for BTC.

There’s a quick update here: Bitcoin spread betting news.


4 September 2017: Warning on Cryptocurrencies like Bitcoin & Ethereum etc.

Warning on Cryptocurrencies like Bitcoin & Ethereum
Warning… Warning… Warning…

We can be pretty flippant on Spread Bet Magazine but when it comes to cryptocurrencies like Bitcoin, Ethereum, Litecoin etc. things tend to get a lot more serious.

The problem with financial spread betting and/or trading CFDs on cryptocurrencies is that you are combining extremely volatile markets with high risk trading products.

  • warningThis cocktail is the worst of both worlds. You will get hurt.
We’ve added a full guide and example of how quickly you’ll be in trouble in our new Bitcoin and cryptocurrency spread betting guide.


30 August 2017: Royal Mail Sent from the FTSE 100

The chart for the Royal Mail shares is ugly and dropping out of the FTSE 100 isn’t good news.

Having said that, I don’t fancy spread betting on Royal Mail right now.

Royal Mail PLC Weekly Chart
Return to Sender


24 August 2017: Worth a Cheeky Punt

Tips When it comes to the financial markets, Spread Bet Mag is not licenced or authorised to give tips. And that may be wise.

Nevertheless, when it comes to sports, we’re not experts here either, but we can and do give the occasional tip.


22 August 2017: ‘Better’ Monthly Rebates

Financial Spreads have adjusted their rebates downwards so that they are easier to get.

Before the change you had to trade £500 in spread costs (spread x stake) to get a 5% rebate, i.e. £25 back. So far so standard.

You can now trade £250 in spread costs and get a 10% rebate, i.e. £25 back.

This should open up the rebate to a few more people.

You can still get a 20% rebate but need to trade £4,000 in a month and that’s a lot of trading (and will apply to very few readers).

As always with rebates, concentrate on your trading…. a rebate is just a brucey bonus.

Also see where to get a trading rebate.


21 August 2017: Hedge Funds Shorting the S&P 500

Below, we’ve taken a quick look at how the weekly Commitment of Traders (COT) report has changed.

As usual we concentrate on the change in the Long:Short ratio by “Non-Commercial” companies – as reported by the U.S. Commodity Futures Trading Commission.

I.e. whether the big speculators like hedge funds getting increasingly long or short of a market.

Large US Stock Markets

  • trending_upDow Jones – there are now 7.4 long trades per 1 short trade on the Dow Jones. In last week’s report that was 4.9:1 so the hedgies are getting increasingly long of the Dow.

    The picture isn’t that clear elsewhere in the US stock market.

  • trending_downS&P 500 – confusingly, unlike the Dow, the hedgies are now short of the S&P 500.

    Last week they were broadly flat and now they only hold 1 long trade for every 1.6 short trades. I.e. the ratio has changed from 1:1 to 1:1.6.

Large Forex Positions

Note – with COT reports, the forex reports always measures a currency vs the US dollar (be careful with misreading COT reports and markets like USD/JPY).

  • trending_upEuro vs Dollar – the big boys are still 1.7:1 long of the euro. They been hovering around this ratio for the last 6 weeks.

  • trending_downPound vs Dollar – the big boys remain short at 1:1.5. Again they been hovering around this ratio for the last 6 weeks.

  • trending_upYen vs Dollar – over the last 4 weeks the ratio has reduced from 1:5.3 to 1:4.1 to 1:3.4 and it’s now at 1:2.8. So traders are still short of the dollar but that ratio is getting flatter.

  • trending_upMexican Peso vs Dollar – with all the negative Trump news, the trades on the Mexican peso are getting less extreme. Over the last 3 weeks the ratio has fallen from 7.8:1 to 5.4:1 to 3.6:1. This market is looking at little like a proxy for how ineffectual Trump is becoming.

  • trending_flatThe US Dollar Index – is the report broken? The US dollar index has been pretty much flat and wavering between 1.1:1 to 1:1.1 for the last 6 weeks. If there is a big reversal of the dollar then either it’s not showing here or it’s a very very slow reversal.

Large Commodities Positions

  • trending_upGold – slow and steady is the way. The long:short ratio on gold has increased steadily over the last 5 weeks from 1.4:1 to 3.1:1.

    Also see ‘Gold Testing the $1,300 Resistance‘.

  • trending_upSilver – similar to gold, the ratio has steadily increased over the last 5 weeks from 1.1:1 to 1.7:1.

  • trending_upCrude Oil (US Light Sweet) – perhaps it’s just the summer but there’s been little change for 3 weeks. Traders are till 3:1 long of crude.


18 August 2017: New Donald Trump Cartoons

It’s Friday and we’ve created a page of our favourite Donald Trump cartoons, images and memes.

If we’ve missed any good ones, please let us know.


18 August 2017: Caution Needed But Volatility Only Back to 2014-2016 Levels

Just in case you didn’t get the message from all the other market commentary about increased volatility, take a look at the VIX charts below.

The general level of volatility is increasing.

The high for 2017 was this time last week on 11 August. We have also seen a couple of other volatile days over the past week.

However, the weekly chart below puts things to perspective. The highs we’ve seen over the last week were pretty typical for much of 2014-2016.


What Does This Mean for Your Spread Betting?
  • trending_flatIf you’re on holiday, there’s no rush to get back
  • infoWith the current levels of volatility at 2014-2016 levels the market is still clearly tradable
  • error_outlineAs always be careful with any trading
  • cloudConsider smaller stakes / reducing positions
  • warningKeep an eye on the VIX getting higher, if it does, consider getting out of all trades until it calms down… when the waves get too big, get out of the water.
Also see live VIX volatility chart.


Daily VIX Chart
Daily VIX Chart: 18 August 2017
Caution Needed



Weekly VIX Chart
Weekly VIX Chart: 18 August 2017
Volatility Back to 2014-2016 Levels


17 August 2017: Gold Breaks Long-Term Triangle Pattern

This is interesting and worth a small trade.

Gold has broken the long-term triangle pattern that we’ve been discussing.

There could a $60 (600pt upside), see gold spread bet update.

Long-Term Gold Triangle Pattern: 17 August 2017
Let’s Take a Break


17 August 2017: Twitter is Censoring Images, Memes and Tweets About Trump

This afternoon @spreadbetmag put this meme on Twitter… but Twitter pulled it…

OK, he may not have said this out loud but banning a Trump meme? Deleting a little satire? Bizarre.

Trump meme: Some of my best friends...
Some of my best friends…


OK, OK, OK. I made the meme above.

Fine. But then Twitter deleted by my next tweet which is just the latest cover of The Economist.

The tweet was just this and picture of the cover:

@realDonaldTrump please make sure you read the latest copy of the @TheEconomist – the cover should give you a clue what it’s about. #potus

Judging by this, they are going to be deleting a lot of tweets! (just not Donald’s).

Shame about Twitter deleting it. It’s a good cover, I look forward to reading it.

Trump KKK Economist Cover - 17 August 2017


17 Aug 2017: Snap Spread Bets End on a Whimper

As expected, Snap gapped lower over the weekend but the speed of the rebound was very quick. I closed my last trade for a miserly profit.

The Snap chart has also broken my very wide channel.

Time to exit.

Snap Chart: 17 August 2017

For more, see Snap inc trading update.


15 Aug 2017: The Foolish Yankees

The North Korea vs USA spat seems to be dying down a little.

It sounds like the adults (in this case China and hopefully General Kelly) have managed to rein in toddlers Jong-un and Trump.

Helping the markets is a new statement from North Korean state media. According to the BBC:

Although prepared for “the enveloping fire at Guam”, the North said it would watch what “the foolish Yankees” do before taking a decision.
  • trending_upThe Dow Jones, S&P 500 and NASDAQ 100 all posted solid gains yesterday
  • trending_upThe DAX 30 had a small bounce off the 4 month low yesterday after finding support on the 200 MA
  • trending_flatIn the UK, July’s CPI data was unchanged at 2.6% (2.7% expected)

The Most Foolish Yankee

Later on today, in the US, we get the July retail sales data which could be interesting.

After April, May and June saw negative readings, another negative reading, or even just a lacklustre figure, could put a little more pressure on the White House.

The chief fool will be wanting to talk about his $1 trillion infrastructure plan.

Not surprisingly, the current plan is very light on detail and many Republican don’t like the idea of all that government spending.

Any positive messaging about infrastructure spending could be drowned out by the Charlottesville debacle.

Trump made such a mess of the condemning the KKK that when he finally did… it was too late for many people.

Merck’s Ken Frazier, Intel’s Brian Krzanich and Under Armour’s Kevin Plank have all left the President’s “American Manufacturing Council”. Hopefully he’s lost a few more supporter too.

Seriously… if you can’t even condemn the KKK what can you do?

71 years old and still fucking useless.

Whose wizard idea was it to put this idiot in charge?
Whose wizard idea was it to put this idiot in charge?



14 August 2017: Snap’s Decline Has Been Pretty Textbook

…but… I’ll also be exiting the Snap market soon.

We’ve had some nice profits but the unknowns are increasing.

There’s an update on my Snap spread bet here.

As many predicted, Snap saw a nasty gap lower on poor Q2 data.


14 Aug 2017: Trump Confirms He’s Still a Dick

Donald Trump has condemned “hatred, bigotry and violence on many sides” at white supremacy rally in Charlottesville. Eh?

The Whitest House
Credit: The Whitest House by Ben Jennings, The Guardian



14 August 2017: Cut Your Trading Costs with a Rebate


Financial Spreads have started running a monthly rebate called “Trader Rebate”.

It looks like one of the more generous rebates on offer and, looking through the terms and conditions, there are no nasty withdrawal clauses.

Rebates are not the be-all and end-all but they can be useful for large or frequent traders.

InterTrader also run a monthly rebate.

We’ve added a new guide, see rebate guide for spread betting, forex and CFDs


11 August 2017: Snap, Crackle and Drop

(Sorry, we must stop using Rice Krispies dad jokes.)

Well, well, well, last night’s Snap Inc Q2 2017 numbers were uninspiring to say the least.



Snap Q2 Highlights:
  • warningDaily Active Users, i.e. main KPI for growth, only grew 4% quarter on quarter
  • warningRevenues of $181.7m
  • warningLosses of $443m
That doesn’t look like a $15bn company to me…

Also, I know we should leave emotions out of trading but who the f*** was religiously buying the stock at $13.50?

With the S&P 500 not accepting Snap, it’s not the big trackers. I hope it’s not my pension fund.

Whoever it was will be in trouble on the open at 2.30pm UK time.

Also see: Miserly Growth Not Helping Q2 2017 Numbers for Snap.

There’s an update on my Snap spread bet here.


11 August 2017: Volatility Has Increased But…

Not by as much as some market commentary is making out:

11 August 2017: Weekly VIX Chart
11 August 2017: Weekly VIX Chart

Also see: VIX update and live VIX chart.


10 August 2017: Fold!

[8pm UK time] Piss! How is the Snap stock still stuck around the $13.50 level?

This is making me uneasy going into tonight’s earnings.

Closed £0.50/pt of my short of Snap @ $13.54 and taken a £50 loss on that. See Snap trade update.


Zombies of the Day

[5pm UK time] Apart from some fun on the open the Snap share price has turned into a zombie and is just drawn to the $13.50 level… again.

Although I doubt that level will hold with tonight’s earnings report.

Talking of zombies… anyone seen or heard from the British Prime Minister…

Theresa May Zombie Cartoon
Credit: New Statesman



10 August 2017: Snap, Crackle and Flop?

Anyone following Spread Bet Magazine will know I’m bearish about Snap Inc.

The new company numbers are due after today’s close.

I’m concerned about good numbers and thinking of reducing my short trade.

Let’s take another look at those poor Snap Q1 2017 numbers.

  • warningWarning for Snap Inc bears like me.

    Yesterday’s 5 minute chart is showing a lot of buying @ $13.50.
Snap Inc - 5 Minute Chart: 9 Aug 2017
5 Minute Chart for 9 August 2017

The average daily volume is 22m shares so that’s not easy to manipulate.

If this continues today then I’ll close or reduce my short before the Q2 earnings come out tonight. Read more.


10 August 2017: Battle of the Babies Boosts Gold

Gold gained $15 yesterday but there’s still no break of the long-term trend we’ve been watching.

Take a look at a great triangle pattern for gold.

(you’ve not missed out, it’s still a case of “no trade yet”).


10 August 2017: “I’m Not Gonna Have Time to Play Golf”

So, The Donald is off on a 17 day “working vacation”.

Is that like “working from home”?

  • trending_upBuy, Buy, Buy
The spread bet on “Total Trump Golf Hours” by the Donald on his (cough) working vacation: 68-72 hours.

4 hours a day? I think that’s worth a small buy.

It would be a “big buy” but writing all those thought provoking tweets must take a lot of time, planning and consultation….

And never one to contradict himself, or just talk a lot of bullshit, here’s Donald’s view of playing golf if you’re the POTUS.


(Sorry, the Total Trump Golfing Hours spread betting market is a made up market – unless Paddy Power catch on).


9 August 2017: Hopefully It’s Just Idiots with Handbags

  • trending_downAfter the Dow Jones and S&P 500 both hit fresh record highs it all got a bit soft yesterday evening.

    Rather than closing at a record high for the 10th day in a row the Dow took a tumble. The S&P 500 wasn’t far behind.

    The markets got more nervous when the Idiot-in-Chief warned North Korea that if they didn’t stop their nuclear programme then they would face “fire and fury like the world has never seen”.

    The new UN sanctions could reduce North Korea’s export revenues by a third, they seem pretty tough. I’m not sure how Donald Trumps “my dad’s bigger than your dad” type rhetoric helps this strategy. Can he even strategise a game of noughts & crosses?

    The message back from the North Korean idiot didn’t help. News from Pyongyang said Kim Jong-un was considering missile strike at US base in Guam.

    The markets don’t like this kind of chat and hit the sell button.

    How serious is it for the markets? Assuming there’s no escalation then traders will soon get bored and start buying again.

  • trending_upSolid US Jobs data has boosted the US dollar.

    (Strong jobs data = possible rising wages = inflation = increased interest rates).


  • trending_upNo surprises that both the euro and the pound got weaker relative to the dollar and that helped the FTSE 100 and DAX spread betting markets.

  • warningWatch Out for a US Dollar Rebound

    A full dollar rebound is probably not in play yet, putting North Korea to one side, Trump is causing plenty of issues elsewhere for the US.

    However, as Michael Hewson, Chief Market Analyst at CMC Markets has said,
In recent days, it has become apparent that after 5 months of losses, the dollar could well be susceptible to some kind of rebound.

Yesterday’s price action seems to confirm that there are some weak short positions on the dollar.


Donald Trump and Kim Jong-un Cartoon
Credit: Brian Adcock



7 August 2017: We Have a Big 7 Days for the Snap Stock

The Ichimoku Cloud on the 4 hour chart, below, suggests more selling but it’s more complex than that.

There was a solid bounce on Friday, there’s new company data due on Thursday and then more stock could hit the market a week today.

See Snap spread betting update.

Snap Inc Chart: 7 Aug 2017
Be careful with this one. Be very careful.



The Spread Betting Diary

A lot of trading diaries are based on fictitious wins or worse. Our spread betting diary is different, we just give a quick personal view of the markets and political world.

Please read the footer of our website re: “SpreadBetMagazine.com does not constitute investment advice etc.”

Thanks

Alex


AuthorAlex Turner

Senior Editor, SpreadBetMagazine