Kenny Halleys Trading Blog

Blue Index ditched

After a few months with Blue Index I decided to ditch trading CFD’s (at least in their format) as in summary: uneconomic.

The main reasons were:

• Very high commissions
• Poor service when your “personal” trader was not available
• A tendency to pressure you into position sizes higher than your comfort level – exacerbated by the high commissions
• Poor position entry
• Pressure to trade
• Too much money on the table

I will cover the points in order:

High Commissions: I managed to negotiate a discount on commissions  (from £50) when I joined Blue Index however at £35 per trade- each way (entry and exit) this could be quite hard to recover on many trades, which tended to encourage you to trade higher position sizes than you would like. it also prevented you from scaling into a trade as to do so incurred further £35 hits.

Poor service issues: I joined BI primarily to try stop making the mistakes I tended to make- I felt they would offer support when a tricky decision would need to be made to enter or exit, and might give good advice. Also as I can’t be watching charts all day long having a pair of eyes monitoring my position would be useful. This side of things was good on occassions (monitoring) however when a tricky decision was to be made their tendency was to back you up to going in when in hindsight being talked out may have been better. I took a  number of trades under a little duress at times- some were OK but some were dogs. But my biggest issue was when you had a position running and your allocated trader was off work – no one really monitored your position closely. This resulted in a few losing trades that should not have been and I was well hacked off.  However they were not shy about calling you wuth trade ideas when your trader was off- so they made sure it suited themselves.

Poor position Entry: Most trades I was offered were clearly momentum trades and I often felt the train had long left the station when they suggested a position. this resulted in entries which were susceptible to drawdowns and stops further away than comfort dictated.

Money on the table: They take no heed of how much money is on the table at any point in time- and would quite happily have you traded up to your limits at all times if you let them. Thats great when your winning but how often was that? Not often enough.

So overall I was not satisfied with the experience, if you removed the commissions I probably would have at least broke even but you ar eup against it at £35 per trade.

Since then I have been studying a new trading methodology which I will post more on at the weekend.

20/7/2008 Weekly watch list

I am not going to post too many charts this week as pretty much all look the same following this weeks carnage and subsequent bounce. Here is a List I am watching

Dmatek: 102, stop 98 target 112.

Some Golden Crosses

BA: Possible Long (if oil falls)
Liberty:
Man:
Amlin
Investec
ITE Group

Some NR7 stocks with inside bars:
Cairn Energy (probably short if breaks down): Watch above 2656 or below 2516
Tullow Oil: Watch below 772 or above 803
Anglo American: Watch which way it goes
AMEC: : Watch move above 854 or below 822

Finally keep close eye on Oil (for break down) and Gold (consolidation expected but watch break below $950)

17/7/2008 Long Gold 956 stopped 960 (+£30)

Gold looks to have recommenced the uptrend this last week or so and has climbed above the pivotal $950 mark, Ihave there fore entered a relatively large position by my standards of $50 (5 x mini contacts) and have an ultimate target above $1000, however for now I have a limit for any spikes up to $780. My stop is at 940 as I am wary of spikes. The price has fluctuated round my entry point for a couple of sessions now so one minute i am well up, the next down. Might be a bumpy one this.

22/7/2008: Stopped out 960 gold went up to 973 or thereabouts before Oil came off sharply. I had left word with BI to tell me if any dramatic moves occured so I could vacate my position but they never and I hit my stop which I had moved up only hourse earlaier. Fromt he standpoint of this I was lucky as it subsequently fell to 918 but was very pissed off at BI who are supposed to monitor my positions when I cannot.

Week Ending 20/7/2008 Weekly Summary

Another appalling week, the FTSe had a capitulation low to 5064 and all my shorts went up! And my only long went down with the market, when for ages it has been performing counter trend. I definitely made some mistakes this week.

Greene King actually went into profit for a matter of minutes on Tuesday i think it was, and as I have discussed before, my thought were to look for a graceful exit to this one, I had the chance but decided to hold in there to see if it was finally going to come good for me, in the event it whipsawed back and hit my guaranteed stop- and in fairness kept on going like a train.

JJB has been on a rally the whole week and I never really had an opportunity to make an exit that  would work for me as it opend up on the Monday.

Finally a Sell note by a major broker saw Drax plummet (going through my stop). It could not have been much worse.

I opened one new position this week and  thats in Gold (mini contracts) I am looking for a rise towards a $1000. I have a limit price of $780 in place but really want to see it go well past here and would be well prepared to remove the limit. My stop is well away at $940- not because I am comfortable with this but because i know you get silly spikes in these markets.

Long Positions

Short Positions

Positions Closed this week

*Costs added/deducted

13/7/2008 Weekly Watch list

A few stocks of interest this week. While the market is bearish and heading down these look like possible Long positions:

John Wood Group: We have been long here and profitted before and while they have come off a bit since then, they are banging on their long term support of the 100 MA and so look a relatively low risk trade. Stop would not need to be too far away.

We could enter with it at 393 as a maximum, though I would be more inclined to suggest 420 to be clear of recent lows at 417. If this fails the next stop is sub £4 around £3.83

AstraZeneca: These are looking to be making headway north having broken out from a decline starting at last summers high. They have bounced against the trend of the FTSE and it looks like thay have solid support beyond 1760. As a stock buy they look pretty decent with a target of £35. As a short term play its a bit more tricky.

An entry right now is hard to gauge as a point to place a stop, it would probably need to be around 2067 and the share closed at 2290 on Friday. So quite a lot of room for maneuver needed. Its one I will be watching this week. Looking on a daily chart however we could be finding old resistance is new support. If it holds above 2262 it could go a long way. The p&f shows the price levels quite well