# Getting feel for SPI open action?



## holyGrill (7 April 2009)

Was just generally wondering what factors one would need to peek at at 7:00am (or whenever the close in the morning is) in order to get a feel for which way the SPI200 will open at 9:50 ?

I'm thinking things like:
US S&P500
Oil
Australian Dollar

Any thoughts on this? Also, which websites would be good for this?

I like afr.com but it gives a pretty brief outline only and I've found it doesn't serve as much help in picking a direction.

hG


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## sinner (7 April 2009)

*Re: Opening SPI: Getting a feel for it*

Just go and read all of THs old posts.

https://www.aussiestockforums.com/forums/search.php?do=finduser&u=9127


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## tech/a (8 April 2009)

Covering over night positions.


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## johenmo (8 April 2009)

*Re: Opening SPI: Getting a feel for it*

www.bloomberg.com
www.futuresource.com
AUD can get anywhere
ten early news


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## jackson8 (8 April 2009)

*Re: Opening SPI: Getting a feel for it*



johenmo said:


> www.bloomberg.com
> www.futuresource.com
> AUD can get anywhere
> ten early news




another site that can be used to track us.futures

http://money.cnn.com/data/markets/


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## holyGrill (8 April 2009)

tech/a said:


> Covering over night positions.




How would you look at this?


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## MRC & Co (8 April 2009)

holyGrill said:


> How would you look at this?




No idea on that........

Don't think you will find any way, but some would look at ADRs and the correlations between % moves in the US and Europe, in relation to the SPI and try calculate some type of 'fair value'.

That's all I can think of.


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## skyQuake (10 April 2009)

MRC & Co said:


> No idea on that........
> 
> Don't think you will find any way, but some would look at ADRs and the correlations between % moves in the US and Europe, in relation to the SPI and try calculate some type of 'fair value'.
> 
> That's all I can think of.




And ain't that a nightmare to work out, some ADRs lead, some follow, and then there's the conversion ratio, AUD etc. And finally what fund manager wants to do that particular morning.


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## MRC & Co (10 April 2009)

skyQuake said:


> And finally what fund manager wants to do that particular morning.




ha ha, yes, the bit that farks everything.


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## holyGrill (13 April 2009)

Just wondering:
Is Brent crude the most common contract for oil (ie the most common proxy for the energy market, as the SPI200 is for say the Australian market) ?
http://futuresource.quote.com/markets/market.jsp?id=energy

To save time manually entering values, I was thinking of creating a script (in python/php or something) to scrape some sites for price values and/or news. 

Wondering what the thoughts are on getting (and using) news information from sites, whether reading manually or obtaining automatically (possibly classifying into good/bad/none by machine learning or something). Whether there'd be any value in this or would it simply be a waste of time (ie information is out-of-date) and effort? 

I'm guessing it probably won't be a complete waste of time as you'd learn alot in the process (about both the markets and programming machines he he).

Will start making notes of opening values and attempt at recognizing patterns and their consequences on the SPI opening. If anyone wants to share ideas / findings, feel free 

hG
ps: ADRs - they're stocks like BHP that trade on more than one exchange, right? is that what you're referring to?


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## Jack Payback (13 April 2009)

Most of the news services quote US oil contracts - light sweet crude or WTI (West Texas Intermediate).

Probably look for the contracts on the Chicago futures exchange.


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## MRC & Co (13 April 2009)

CL on the NYMEX.

Some algo bots are already trying to trade news I believe, but you would need the fastests news feed and execution, no point if you don't have BOTH of these IMVHO, unless you are taking a longer-term fundamental view.  

Yes, correct on ADRs.


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## holyGrill (23 April 2009)

Cheers MRC.

I am collecting am Close (price at 6:55) and pmClose (price at 16:30) for a few things (using IGmarket's puredeal) including SPX500, gold, AUD, brentCrude.

Hopefully by looking at the change in prevCls/amCls and getting some market news (whatever may be available at 6:55 in the morning! not much I guess?!) one can start to get a feel for which direction the SPI is going to open in ... when my live feed for stocks is good again I'll add some ADR's, in partcular BHP - it must be a fairly big force  (large index weighting).

Wondering if anyone's experimented with neural networks / datamining for determining relationships between input parameters and effects on the SPI?

Came across this - what are thoughts?


> "Watch out for Australian statistics which are usually announced 11-30am Sydney time also the RBA announces interest rate decisions on the first Tuesday each month at 2-30pm, at these times volatility goes pretty high."




cheers,
hG


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## MRC & Co (23 April 2009)

Yes, of course volatility goes up at these times, these are fundamental news releases which traders try to interpret quickly in relation to expectations and hit ASAP.

On the rest, sorry can't help you.


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## holyGrill (24 April 2009)

ARe there any sites that have up-to-the-second news feeds of this kind?
(other than full-blown subscription to bloomberg / reuters which cost thousands)...

Also:
Any reason why the SPI200 would have gapped lower this morning? Is this action predictable to an extent? Gold, Crude and AUD were all up overnight ... Even the S&P500 was ... yet SPI200 gapped lower.

I guess the pre-open orders of the stocks in the index will have alot of influence on the open. And it would depend on the causality effect: do the stocks lead the future or the other way around? (at the open specifically)

hG


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## Trembling Hand (24 April 2009)

holyGrill said:


> Also:
> Any reason why the SPI200 would have gapped lower this morning? Is this action predictable to an extent? Gold, Crude and AUD were all up overnight ... Even the S&P500 was ... yet SPI200 gapped lower.




If you think we follow these things your way off track.


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## holyGrill (24 April 2009)

Thanks TH.
But why do you say that? I also noticed you have said in a post before that 60% of the time or so the SPI will do the opposite to what the S&P500 did overnight. 

Can I ask what your thoughts are on which factors to look at instead of these?



Trembling Hand said:


> If you think we follow these things your way off track.


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## Trembling Hand (24 April 2009)

holyGrill said:


> Can I ask what your thoughts are on which factors to look at instead of these?




Look at the SPI to trade the SPI.


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## holyGrill (27 April 2009)

You don't look at ANYTHING else but the SPI when trading it? What about the big guns like BHP, RIO, etc?

News feeds (IR announcements, etc) ... ?



Trembling Hand said:


> Look at the SPI to trade the SPI.


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## Trembling Hand (27 April 2009)

holyGrill said:


> You don't look at ANYTHING else but the SPI when trading it? What about the big guns like BHP, RIO, etc?
> 
> News feeds (IR announcements, etc) ... ?




Not really.

I watch the ES, N225, HSI, K200 but mostly we are lock stepped rather than following and if not we lead more than lag.

Mostly stocks follow futs.... mostly


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## MRC & Co (27 April 2009)

Trembling Hand said:


> we lead more than lag.




Hate that!


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## mlennox (2 May 2009)

Trembling Hand said:


> Look at the SPI to trade the SPI.




Ding, also try and look at it from the perspective of fair, over-valued and under-valued. Be aware of S/R,Channels etc, but focus on price.


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## holyGrill (4 May 2009)

This is probably extremely obvious but why not trade the laggers then instead?   Or perhaps mean-reverting pair-trades?

hG



MRC & Co said:


> Hate that!


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## Trembling Hand (4 May 2009)

holyGrill said:


> This is probably extremely obvious but why not trade the laggers then instead?   Or perhaps mean-reverting pair-trades?
> 
> hG




How are you going to know which one will lead today?

How are you going to know which one is going to go its own way today?


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## holyGrill (6 May 2009)

Trembling Hand said:


> How are you going to know which one will lead today?
> 
> How are you going to know which one is going to go its own way today?




No idea, guess you'd have to look at backtesting some patterns of what-follows-what-when-how-often  

Not sure how that could be done, mathematically even ... regression analysis ?  Can lead-lag relationships be determined by phase-shifting one price series or a this-one-moved-first-then-this-one-moved-in-same-dir sort of analysis ... i'm sure there must be a more formal definition for it (causality?) but yeah, support/resistance is probably easier he he ...


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## holyGrill (7 May 2009)

Ok so i took a 'punt' today, based on a channel breakout and got a little lucky, made 2.5 tics profit [not counting the 2ticks spread cross - good article TH on 'free CFDs' and the real cost of trading CFDs. Cant wait to scrape enough cash together for an IB account featuring DOM! 

For now, my little IG account will have to do ...

Wondering if this trade was pure luck or is this a reasonable method (i've read alot about breakouts)- anyone else look at this breakout?

cheers,
hG


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## Trembling Hand (7 May 2009)

holyGrill said:


> Wondering if this trade was pure luck or is this a reasonable method (i've read alot about breakouts)- anyone else look at this breakout?
> 
> cheers,
> hG




Was your plan to take 2.5 ticks based on anything other than closing out the trade just cuz it got into profit?

Was it based on a reasonable R:R?

If not NO


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## holyGrill (7 May 2009)

Trembling Hand said:


> Was your plan to take 2.5 ticks based on anything other than closing out the trade just cuz it got into profit?



to be honest i saw the $12.50 profit, nearly creamed myself and took the profit! lol no profit target or anything, just A profit was the target I guess.



> Was it based on a reasonable R:R?
> If not NO



Well, the risk is $25 since I use a 5point stop. This in effect is only a 3pt-stop though since the cross adds another 2 points (the moment I place the trade I'm 2 points down). I know this doesn't leave much room for movement against me and unless the trade goes my way immediately I'll get stopped out (at a $25 loss!) But then again using a larger stop will reduce my Reward/Risk even more ... not sure what to do here - set a higher profit target? but if it dont get hit, gonna throw profits away by not taking them ...

its quite expensive to be testing this manually with real $ tho ... what the optimal profit-target would be ... perhaps a simple trailing stop's the way lol

hG


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## beamstas (7 May 2009)

holyGrill said:


> to be honest i saw the $12.50 profit, nearly creamed myself and took the profit! lol no profit target or anything, just A profit was the target I guess.
> 
> 
> Well, the risk is $25 since I use a 5point stop. This in effect is only a 3pt-stop though since the cross adds another 2 points (the moment I place the trade I'm 2 points down). I know this doesn't leave much room for movement against me and unless the trade goes my way immediately I'll get stopped out (at a $25 loss!) But then again using a larger stop will reduce my Reward/Risk even more ... not sure what to do here - set a higher profit target? but if it dont get hit, gonna throw profits away by not taking them ...
> ...




You risk $25 to make $12.50
You ain't gonna last long with that type of trading


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## holyGrill (7 May 2009)

fully agree. So I wait to hit $25 profit instead, that way at least I have R:R of 1   [easier said than done I think, will give it a try tho]. Need a simulator or something to test these   [unless someone can suggest an algorithm for identifying channels...hmmm]



beamstas said:


> You risk $25 to make $12.50
> You ain't gonna last long with that type of trading


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## beamstas (7 May 2009)

holyGrill said:


> fully agree. So I wait to hit $25 profit instead, that way at least I have R:R of 1   [easier said than done I think, will give it a try tho]. Need a simulator or something to test these   [unless someone can suggest an algorithm for identifying channels...hmmm]




Even if you can achieve a win rate of 50% (very difficult, especially for a new trader), you are going to be at break even *at best.* 

My advice: Wait to $25 profit, put your stop loss at break even, then go out for a jog or something


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## holyGrill (11 May 2009)

Ok so I've managed to nicely hemorrhage about 100bucks in 4 trades.

I started getting a big head after 4 winners in a row. What a way to bring me back down to earth! 

Gotta be more disciplined and stick to the break-even stop-loss (thanks beamstas!). Finally got the trailing stop working on IG's puredeal (even though I have to manually activate it each time in settings, so annoying).

Happy future trades today chaps ...

hG




beamstas said:


> Even if you can achieve a win rate of 50% (very difficult, especially for a new trader), you are going to be at break even *at best.*
> 
> My advice: Wait to $25 profit, put your stop loss at break even, then go out for a jog or something


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## skyQuake (11 May 2009)

imo its a lot harder to scalp with IG. Personally I think position trading is fine with them, scalping is just way too hard. 
In the live market, you can weasel your way into a trade (ie let someone fill you) so you start off brkeven, or hit market (pay 1 tick spread).
That 2 tick spread is gonna cost dearly sooner or later.


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## Trembling Hand (11 May 2009)

skyQuake said:


> imo its a lot harder to scalp with IG. Personally I think position trading is fine with them, scalping is just way too hard.
> In the live market, you can weasel your way into a trade (ie let someone fill you) so you start off brkeven, or hit market (pay 1 tick spread).
> That 2 tick spread is gonna cost dearly sooner or later.




Yep. Its a shame most start out in the wrong instrument trying the wrong strategies without the right understanding of what makes a trade profitable.

anything less than 20 tick target trading cfds ya gonna struggle. IMNSHO


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## holyGrill (11 May 2009)

20-tick target - that's pretty big. 

Not having DOM and with an extra tick spread in and out I'm starting to realize how hard it is to make $$ with Aussie200 $5mini CFDs. 

I'd still like to try some breakouts through-out the day though, with some larger profit targets.

If making money with the Aussie200 cfds means IG is losing $ (if they take the other side) that's all the more incentive to make $ he he 

if you had to say TH, what would be your NSHO on strategies for disadvantaged, disillusioned CFD-traders like myself attempting 20tick targets? I'll be sticking to breakouts for now, they're pretty straightforward he he.

hG



Trembling Hand said:


> Yep. Its a shame most start out in the wrong instrument trying the wrong strategies without the right understanding of what makes a trade profitable.
> 
> anything less than 20 tick target trading cfds ya gonna struggle. IMNSHO


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## Trembling Hand (11 May 2009)

holyGrill said:


> 20-tick target - that's pretty big.
> 
> Not having DOM and with an extra tick spread in and out I'm starting to realize how hard it is to make $$ with Aussie200 $5mini CFDs.
> 
> ...






Actually I think scalping is the worst place to start. Could you tell my why you are? Why would you not be trying to trade 20 -40 tick targets.

As for breakouts on an intraday basis. I sit in front of the screens all day and rarely see them. Whats your read/stats/backtest on such events occurring?


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## beamstas (11 May 2009)

Trembling Hand said:


> Actually I think scalping is the worst place to start. Could you tell my why you are? Why would you not be trying to trade 20 -40 tick targets.
> 
> As for breakouts on an intraday basis. I sit in front of the screens all day and rarely see them. Whats your read/stats/backtest on such events occurring?





True
It is very hard to find intra-day breakouts like you would see on a traditional EOD chart for a stock

I've managed to pinpoint *one* today

The more screen time im getting the more im coming to realise what TH has just said


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## holyGrill (11 May 2009)

unfortunately I dont have any  read(?)/stats/backtesting results on these events. I read somewhere on here or eliteTrader (cant remember which) that the aussie200 follows S/R like a glove which I guess somehow I equated this with breakouts (by definition if the S/R channel is broken, this means breakout is occurring?)

And then it worked for me, once   (and i got a warm fluffy feeling inside like I've discovered gold . but the warmth only lasted until my next ever-so-disappointing breakout LOSS of $25 :-( 

Will take your word for it that they don't occur very often. I cant really afford to test the theory for much longer - not with real $ anyway. 

I can't think of any high-probability scenario that'll push the market 20 - 40 pts ... unless a pre-open (< 7am) can be entered but so much scope for news to come out in the meantime ... risky risky risky i've gotten burnt a couple of times (too much warmth)

hG






Trembling Hand said:


> Actually I think scalping is the worst place to start. Could you tell my why you are? Why would you not be trying to trade 20 -40 tick targets.
> 
> As for breakouts on an intraday basis. I sit in front of the screens all day and rarely see them. Whats your read/stats/backtest on such events occurring?


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## Aussiest (11 May 2009)

holyGrill said:


> Well, the risk is $25 since I use a 5point stop. This in effect is only a 3pt-stop though since the cross adds another 2 points (the moment I place the trade I'm 2 points down). I know this doesn't leave much room for movement against me and unless the trade goes my way immediately I'll get stopped out (at a $25 loss!)




Why don't you trade with mini contracts on IG? You could start with 0.1 of a mini so you are not losing so much $$ to start off with. You won't make much per tick, but it may help with setting stops, testing and getting used to 'holding'.


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## holyGrill (11 May 2009)

0.1 of a mini?  How do I enable this on IG? I thought $5/pt was the smallest one could trade ... ?
(i use the web-based PureDeal btw - that what you're using?)

sounds like a good idea!



Aussiest said:


> Why don't you trade with mini contracts on IG? You could start with 0.1 of a mini so you are not losing so much $$ to start off with. You won't make much per tick, but it may help with setting stops, testing and getting used to 'holding'.


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## Trembling Hand (11 May 2009)

holyGrill said:


> unfortunately I dont have any  read(?)/stats/backtesting results on these events. I read somewhere on here or eliteTrader (cant remember which) that the aussie200 follows S/R like a glove which I guess somehow I equated this with breakouts
> 
> Will take your word for it that they don't occur very often. I cant really afford to test the theory for much longer - not with real $ anyway.
> 
> ...




boy oh boy!!

And people ask why I have permanent PMT??


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## Aussiest (11 May 2009)

holyGrill said:


> 0.1 of a mini?  How do I enable this on IG? I thought $5/pt was the smallest one could trade ... ?
> (i use the web-based PureDeal btw - that what you're using?)
> 
> sounds like a good idea!




I think it's a good idea!

I use PureDeal for some of my trading as well.

Go to Navigate > Indices > Stock Indices > Australia

And then you'll get the screen that has the 'Australia 200 Cash' contracts.

Look at Australia 200 Cash (A$5 Mini Contract). According to my calculations, 0.1 of a mini contract should be $0.50 per pip. Chicken feed i know, but good if you're wanting to get the feel for it.

Also, try to trade it as you would with more funds. Eg, set your entry (find reasons), stop loss and profit expectation (estimated exit point).


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## Trembling Hand (11 May 2009)

Aussiest said:


> Look at Australia 200 Cash (A$5 Mini Contract). According to my calculations, it should be $0.50 per pip. Chicken feed i know, but good if you're wanting to get the feel for it.






$5 contract is $5 a tick


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## Aussiest (11 May 2009)

Trembling Hand said:


> $5 contract is $5 a tick




Oops, yes. Just edited, sorry. Meant to be 0.1 of a mini is $0.50..


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## Trembling Hand (11 May 2009)

Aussiest said:


> Oops, yes. Just edited, sorry. Meant to be 0.1 of a mini is $0.50..




But you cannot trade less than a full contract


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## holyGrill (11 May 2009)

where do you get 0.1 of a mini ($5.00/contract) from?

The Aussie200 is $25/contract
The mini is $5/contract

I think you've got it confused, like a mini on the mini ... (which doesn't exist, does it?)



Aussiest said:


> Oops, yes. Just edited, sorry. Meant to be 0.1 of a mini is $0.50..


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## Aussiest (11 May 2009)

holyGrill said:


> where do you get 0.1 of a mini ($5.00/contract) from?
> 
> The Aussie200 is $25/contract
> The mini is $5/contract
> ...




No, on my system you can get increments of contracts, eg, an increment of 0.1 of a contract. But, then again, i've got TradeSense enabled. Will post a JPEG in a minute. You can definately get 0.1 of a mini with IG.


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## holyGrill (11 May 2009)

Lol 



Trembling Hand said:


> boy oh boy!!
> 
> And people ask why I have permanent PMT??


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## Aussiest (11 May 2009)




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## nomore4s (11 May 2009)

Trembling Hand said:


> boy oh boy!!
> 
> And people ask why I have permanent PMT??




I just thought you weren't getting enough:

Is it little wonder so few people succeed at this game, when so few are willing to put in the hard work themselves and find their own edge.

Aussiest, on my platform you can only trade 1 full contract. Is that off the demo account or the full account?


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## Aussiest (11 May 2009)

nomore4s said:


> Is that off the demo account or the full account?




It's a non-demo account. When i signed up i selected the "TradeSense" option, which enables you to deal in increments of contracts for the first 6 weeks. I don't think you can activate TradeSense once you have a full account though.


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## holyGrill (11 May 2009)

yup unfortunately that's right ...



> Dear Mr. holyGrill
> 
> Thank you for your email.
> 
> ...


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## Bobby (11 May 2009)

So thats one tenth of a $5 mini contract , gees .50 cents a point  !

What will they offer next ?   

Maybe the super dooper ~  teeny weenie mini micro  1/100 contract for .05 cents


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## beamstas (11 May 2009)

If you can't afford $5 a tick you shouldn't be trading the SPI

But if you really must you can trade SPI CFD's which are simply $1 a tick

Cheers
Brad


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## holyGrill (12 May 2009)

$1/tick SPI, which contract is that? not on IG? 



beamstas said:


> If you can't afford $5 a tick you shouldn't be trading the SPI
> 
> But if you really must you can trade SPI CFD's which are simply $1 a tick
> 
> ...


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## holyGrill (18 May 2009)

not to have a bitch but the 3 - 5 second lag in getting filled on the CFD $5mini is screwing me over in addition to the extra point spread.

And occasionally when I'm supposed to get a nice fill, 'conveniently' the 'price is no longer valid' ... !!!!!!!!!!!!

Can see why IG is making alot of money off people ...

there's my rant for today!

hG


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