LS Trader Weekly Update

The LS Trader Financial Spread Betting Weekly Update

During the past week we exited 3 trades, 2 of which banked nice profits and one of which was a loss. The 2 profitable trades were both interest rate futures, and were the 10 year T Note and the 3 month Eurodollar. The loss came from the Pound/Yen trade after a sharp reversal of the lows. We also banked very nice profits from the rollover of February Natural Gas in to March Natural Gas.

This week we have 3 new trades to enter. If you are not already a subscriber you can find out what they are by signing up here.

Stocks

The stock markets ended roughly flat after a volatile week. The trend in the stock markets remains down and I’m still looking for tests of the 2008 lows. First we will need to see a break of support at the current contract lows.

Things don’t bode well for stocks right now as there are various indicators stacking up against them. Currently both the long and short term trends are down and in addition to that the January S&P Barometer which I wrote about a few weeks ago indicates that the markets will close the year down.

The January Barometer states that as the S&P 500 goes in January, so does the rest of the year. This indicator has a 91.4% accuracy ratio over the past 58 years! The current contract in the S&P 500 is the March contract and this opened the year at 902. It ended the month on Friday at 822, almost 9% lower for the month.

So, all things considered it is unlikely that we will such much upside movement in stocks for the foreseeable future. There will most certainly be some bear market rallies along the way but I don’t see us having any buy indicators for stocks any time soon

Commodities

From last week “The fact that Gold went up in a week that the Dollar rose is a bullish sign for Gold”. Gold also had a fairly wild week but ended higher after declining early in the week. The current rally in the April contract may head up to a test of $950.

Crude Oil’s 5 day rally ended at $48.05 and then moved lower for the week. A range is forming between around $40 & $50 which may be the key levels for now and a break of either should yield movement. Natural Gas continued the long downtrend and yet again posted new contract lows.

The agriculture sector remains very weak, with Lumber once again making new contract lows. This has been a great short trade for us as we have been short since the 25^th August and are showing large profits from this trade.

Currencies

The US Dollar Index gained for the week and may still be headed to 8800. The US Dollar gained against most of the major currencies with the exception of the Pound, which was sharply higher for the week.

Interest Rate Futures

Interest rate futures fell for the week and the current long term uptrend seems to have run its course. Our long interest rate futures trades have all been profitable for us and as I have written previously, there could be a major trend reversal in these markets later this year which should lead to some nice profitable short trades.

Yours for bigger winners, more often

Robert Stewart & Phil Seaton

www.LSTrader.co.uk

PS. If you are not already a subscriber to LS Trader, you can sign up here