Spread Betting Markets Are Looking Up

Posted on | August 6, 2010 |

The stock markets appear to be consolidating around current levels with the UK’s FTSE 100 Index failing yet again to make headway above 5400. At the same time though the FTSE 100 is showing no wish to drift below the 5340/50 level either.

This small range is making for rather tiresome spread betting for all those trading with IG Index and the other spread betting companies.

No doubt bulls will be hoping that the current lull is just a pause before the market gathers its collective breath for a push higher. Of course those selling the market via spread betting will be gathering evidence that investors are losing their enthusiasm at these levels.

The current price is 5350, at the bottom of the more recent range, and the investors who are financial spread betting are busily closing out the short positions that they set up at the highs.

This short-termism is paying off as the senior UK index continues to flatter to deceive. Nevertheless with the slower summer months still dragging on volumes, it is difficult to get too exited about a move in either direction.

Looking at the US markets, the Dow Jones has finally managed a whole session above 10,600. Of course after that session the market dropped and continually flirted with the same 10,600. Looking back over the last couple of months, 10,580/95 proved quite a barrier to overcome, as such, it would be rather disappointing if we were to give up on it quite so easily.

All this means is that investors will be watching any approach to the 10,580/95 price support level as a buying opportunity. Of course, any such buying should be done with caution just in case the price support fails spectacularly.

Spread Betting Note:

Spread betting is a leveraged product. It carries a high level of risk to your capital and, as it is possible to lose more than your initial investment, it may not be suitable for all investors. Therefore, ensure you understand the risks involved and seek independent advice if necessary. The tax treatment of spread bets may be subject to change in the future

The above should not be construed in any circumstances as a recommendation or offer to sell or recommendation or solicitation of any offer to buy any security or other financial instrument.

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