Skip to main navigation or content
You are here:
After an adrenaline-fuelled weekend away, I was feeling as fresh as a daisy sitting back at my desk this Monday morning. As I switched the TV on, I was greeted with news of the government's acquisition of Bradford & Bingley. It wasn't quite another Northern Rock, as the state got its act together quickly this time, flogging off part of B&B's business to Santander. But no cheers from investors, as the market was well down through the day.
Advertising
What with the huge bailout of the financial system by the US government, a fall in the US dollar was always looking likely. And that, in turn, will have an effect in the commodities market. Gold could be a big winner. But for stocks, the only way is down, just for now.
As a result, I've no open positions on equities right now. However, I am playing the currency markets. I am in the money on my sterling/dollar trade, with a lovely profit likely on Tuesday. I have 3 cents of margin for my low barrier, which was set at $1.772. I also have a €/US$ trade open with clients, and that is a range trade. The high barrier is set at $1.508 and the low barrier is set around $1.395. The best I can hope for is for the bailout plan to come off, and the $ to give up some ground to the pound and euro, although not too much!
I am looking to place two trades this week. One would be shorting the Dow, if I saw a reaction rally to the bailout plan and possibly another range trade on the currency markets. With regard to the dollar, it will remain under pressure as global markets are flooded with greenbacks. On the other hand, though, the UK and European Central Banks will soon have to join the interest-rate slashing spree to combat the looming recession. That could help the US dollar recover some ground.
After I bag some profits, I will be trading again by Wednesday, as long as I see what I'm hoping for in the US bailout. I wish you the very best if you are trading right now.
Read all Matt Shaw's columns...
Or see Investors Chronicle's new, FREE, investment guide to fixed-odds betting.
If you have any queries about fixed-odds, or trading the indices in general, I'd love to hear from you. Please e-mail me on: matt@fixedoddssuccess.com.
Or visit my own website at www.fixedoddssuccess.com
The UK’s No.1 Stockbroker
Access a selection of share tips, comprehensive company analysis and full financial data on listed companies. Plus portfolio tools with advanced alerts when you register for free here.
Advertorial Feature
With so many big moves in the world's financial markets, there have seldom been more opportunities around for spread traders. Isn't it time you joined them?
by Dominic Piccarda
© The Financial Times Limited 2008. All rights reserved. "Investors Chronicle", "FT" and "Financial Times" are trademarks of The Financial Times Limited. No part of these web pages may be reproduced or transmitted to or stored in any other website or other form of electronic retrieval system, without prior permission in writing from the editor.
Warning: Do remember, particularly if you are new to stock market investment that the prices of shares and other investments can fall sharply. You may not get back the money you originally invested. The material here is for general information only and is not intended to be relied upon for individual investment decisions. Take independent advice before making such decisions. This site is aimed at UK residents only. To read more please see our Important Warning
-IC-1.5.4a-prod - 31/10/2008 13:11:34 - carlos.princz
