Quick round up of todays action with the help of the updated chart below. The FTSE traded within the range anticipated for most of the morning, then sold off in the afternoon and broke though the support level at 6249. I took a small long as price hit the support level and managed to scalp a few points.

In hindsight I should have traded off the MACD divergence signal and switched my bias – apart from the early rise this morning the market has been trading under the 20 SMA (simple moving average) and I would have done better getting short this afternoon.

On the daily and hourly charts the break in market structure is quite clear, so I’m expecting further weakness for the rest of the week.

The market remained in positive territory till it promptly sold off around 1:45pm and eventually fell back to the intraday support level around the 6420 level. I managed to get long again off a MACD divergence pattern, coupled with the fact that price was testing the support level for the third time (triple bottom).

Well the market rarely does what you think it will do and this afternoon was a good example. There was the ECB announcement this afternoon followed by a speech by the Fed in the afternoon. The result was a bit of a carnage in the afternoon with the markets selling off (due to a fear of interest rates going up).

I’m a price action trader so the news or fundamentals don’t really matter to me. What does matter is how price behaved  after the news and how best to trade it.

When news has this kind of effect on the markets, the best thing to do is get on board the train! Look for potential pullbacks to key support / resistance levels, or pullbacks to the moving average as shown in the chart below.

First post on the blog so I’ll make it brief.

I’ll trade the FTSE over the next couple of weeks and see how I get on – if things pan out as expected then I’ll expand into a few other markets, possibly the DOW or the DAX.

I’ve traded various markets in the past including forex but love trading indicies and seem to have better results focusing on one or two markets at a time.

My potential trades for the day are marked out on the chart below. Note that I mark out key levels of support, noticeable trendlines or channels, and try to use the MACD histogram to signal suitable entries (or sometimes the moving averages). Also I have the higher timeframes very much in mind and try to look to buy the market if bullish and vice-versa.