The new laws come into effect today regarding naked shorting (well they aren’t really new naked shorting was always illegal but not policed heavily). This essentially means you have to take possession of the stock when shorting. This may have some limited short term effect but longer term I think the bears are here to stay, naked or not.

As for this bear I’m still firmly maintaining my sell conviction. The last rally we had which I sold into caused me quite a bit of pain dragging on far longer than anticipated but yielded great rewards with just under 3K in profit. And again I’m selling into any strength by increments of 100, that is increments on the FTSE and not my monetary position. I’m looking to sell all the way up to 5800 where I see heavy resistance. The last time the rally went on for about 5-6 weeks, this time I think it will die down quicker. Well I hope.

This is another reason I’m more comfortable trading December contracts as I have time on my side should the rebound drag on longer. Why I’m not buying the trend is a personal choice and I seem to be happier shorting. If I was a more eager and learned trader I would be making money on the way up and following it all the way down. However I’m not, I’m a newbie and know enough to know when to tread lightly. A bounce now could potentially fade very fast, much faster than I could act. Shorting seems more natural in the current state of economic malaise.

On Friday the markets bounced again and at the end of the session I sold another 2.50 bringing my short to 5 Euro. My next shot is at 5500 and 5600. My expected time frame is 4 weeks till the positions start making it back into the black.

Happy Trading.

P.S. Congratulations to IG Index with their stellar growth and 40% rise in full-year profits. I’m happy to say I have played my part in this and hopefully their service and products increase with their returns. Disclaimer: I haven’t lost money yet, I may have had something else to say if I had.