November already....and doubtless many Brits will be seeking a bonfire this weekend - possibly to burn a credit card or two if they have any sense! Personal insolvencies are seemingly 'up by 55%' according to the Insolvency Service, and house repossessions are now back (up) at 1992 levels - some of us might be able to recall that that was the time when 'negative equity' was at its height. Yet Abbey is now offering mortgages of five times joint income! They (or at least their shareholders) may live to regret it. In the USA, new houses are being offered for sale at ever - decreasing prices - "Plunging at their fastest rate for 36 years" according to Marketwatch. Walmart's sales are apparently down 10% on last year - so the 'change' we discussed last weekend is perhaps gathering pace now.

But old Grumpy Gordon will be pleased enough with the Stern Report on the costs of global warming - it couldn't have arrived at a better time - when recession bites, it won't be his fault after all! What an absolute gift to politicians everywhere - taxes can go up under its guise and nobody dare complain. I'm just amazed at how incredibly brilliant Professor Stern must be - if we (ie politicians) do nothing about it, climate change will cost the 'world economy' £3.68 trillion. What a clever guy, to arrive at such a precise figure! What a load of tosh - it's not the cost to the economy we should be worried about now that climate change is almost certainly irreversible, and the true cost, in every sense, will be vastly greater than any of us can even imagine. But it sounds good to provide an 'accurate' cash figure, doesn't it? A bit like the London Olympics perhaps. Talk about selling the coming generations down the river!

Anyway, what next for the markets then?

Still 'Up' I suspect, for a while yet - despite the above remarks. Sure, there will probably be a bit of a retrace during the week, but the extra leverage in the USA (discussed last weekend) will likely keep things on the boil for a while yet - very possibly into next year.

Not really a great deal 'new' to remark upon this weekend, quite frankly, so let's have a look at a couple of charts - my remarks over the past couple of weekends certainly seem to have struck a chord with several of you, with regard to 'staying in a trade' - ie not exiting too soon. I know that more than one of you feels a bit miffed at having parted company with J D Wetherspoon around the 500 mark! That is the entire point of letting the market 'come to you' - let the moving average (DMA) do the hard psychological work on your behalf - don't try to second - guess events because that process definitely tends overall to bite you in a tender part of your anatomy. You have heard this from every successful trader whose courses you have perhaps bought - "Let the winners run..." (And the converse of course - "Don't let the losers run...") Frequently you'll experience a number of stopouts either for (controlled) losses or for small gains, but it's the bigger winners that really make the difference between 'adequate' overall returns, and 'excellent' ones. The markets have been trending nicely upwards for quite a while now, and as already mentioned in an earlier WICS, there are a fair number of previously - mentioned stocks (ie 'watch list' stocks) that are still motoring on to the upside and providing excellent profits for many of you, I'm pleased to note.(By the way, some of you have quite rightly raised the question of the number of 'buy' trades to have open, as related to the number of 'sells' - recently, 'sells' have been somewhat harder to come by than 'buys' so the way round that is to have fewer than the suggested maximum of twelve trades running at the same time. Twelve trades that are all in the same direction would be pushing your luck a tad - normally we would like to see six in each direction, but 'normally' doesn't happen that often!)

One of you emailed me during the week to say he had been stopped out of a couple of the trades mentioned last weekend, and that he couldn't understand why I was suggesting I was still in them - it seems he had his stop loss EXACTLY on the relevant dma and had paid no attention to 'round numbers' either. Nowhere have I ever suggested that I hold my Stop Loss exactly on ANY dma - I always allow 'a few points' of leeway, and I always watch out for numbers that end in '5' or in '0'. You already know this of course, and my correspondent had simply misunderstood something I had also suggested earlier - that if you prefer to hold a SL (Stop Loss) EXACTLY on a dma, then choose a LONGER one than I use - but still take account of these 'round numbers'! I just prefer the 'flexibility' of keeping a few points in hand, as it were - but it's in no sense 'wrong' to choose a longer dma if you prefer the relative precision of moving your SL exactly to reflect its position. It's fair to suggest however, that it's ALWAYS 'wrong' to move a stop loss to a number ending in '0' or in '5'.

Anyway, below I'll use the chart of Cable & Wireless to show you what I mean, and then we'll examine AGA to see if a potential 'sell' might be in the offing as well as the opposite - and that will be plenty for this weekend - a few emails during the week have suggested that possibly I'm becoming guilty of providing you with 'information overload'!

Happy trading till next weekend.

Ian.