Support 5891 5885 5871 5836 5794 5760
Resistance 5923 5951 6002 6008 6096

Good morning.
Market Summary for Thursday
The main focus today was the drop in the US dollar which boosted commodity prices and therefore gave a lift to mining and oil shares. This fall in the dollar was created by a reduced expectation for a rate hike in the U.S.
The FT100 had a small ex-dividend of 2.9 so this had little effect. The thing which stood out was the 4 waves of 100 point moves during the day indicating great disparity between bulls and bears.
Commodities were the best performing shares with “safe” shares being amongst the weakest – this pattern tends to oscillate regularly.

US & Asia Overnight from Bloomberg
Asian stocks fell, with the regional benchmark index heading for a weekly loss, after Japanese shares declined as the strengthening yen pressured major exporters.

The MSCI Asia Pacific Index lost 0.5 percent to 120.53 as of 9:16 a.m. in Tokyo. The measure is poised for a 0.7 percent decline this week as Japan’s Topix index erased its gains from last Friday’s Bank of Japan stimulus and the yen headed for its best weekly gain in seven years.

“It’s still way too early to say we’ve found the bottom,” Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors Ltd., said by phone. “The nervousness we’ve seen in global markets relates to the strength of the U.S. dollar putting downward pressure on oil and equities. With the dollar looking like it might have topped, the negative dynamic may have been broken. A weaker dollar though means a stronger yen and that makes life more difficult for the Japanese share market.”

Japan’s Topix index lost 1.5 percent, heading for a 4.4 percent weekly loss. The index has wiped out a 5.1 percent rally following the Bank of Japan’s stimulus boost. The yen traded at 116.81 per dollar after rising in the past four days.

South Korea’s Kospi index slipped 0.2 percent. Australia’s S&P/ASX 200 Index retreated 0.4 percent. New Zealand’s benchmark gauge declined 0.1 percent.

China Markets
Futures on the FTSE China A50 Index added 0.2 percent in most recent trading, while those for Hong Kong’s Hang Seng Index gained 0.5 percent. China’s Shanghai Composite Index climbed 1.5 percent on Thursday as the central bank stepped up efforts to ease a cash shortage before mainland markets close for the holidays next week.

Trading volumes could be muted in Asia as investors prepare for next week’s Lunar New Year break. Mainland Chinese markets are closed all week with Taiwan, while Hong Kong is shut for the first three days, resuming Thursday.

E-mini futures of the Standard & Poor’s 500 Index fell 0.2 percent. The U.S. equity benchmark index rose 0.2 percent on Thursday amid a rally in raw-material and industrial shares, as the dollar’s weakness boosted commodity prices and optimism for profits at multinational companies.

Patchy U.S. economic data ignited the dollar’s retreat this week, as concern grows over the vulnerability of the American economy to outside forces. The fixed-income market is all but pricing in zero rate hikes from the Fed this year, as central banks from Asia to Europe have mixed success with their efforts to stymie the turmoil that’s roiled markets in 2016.

While a weaker dollar makes commodities cheaper, and therefore more appealing in other currencies, oil remains an entity unto its own, reverting to losses Thursday as investors focused on the fact U.S. crude supplies are at their highest in more than 80 years. [Bloomberg]

FTSE Outlook and Prediction

FTSE 100 Prediction

FTSE 100 Prediction

Today of course is NFP news at 1330 which makes it fairly hard to predict what its going to do around then. The forecast is 192k, so slightly under the previous report, but around 200k should be seen as a positive. Looking at the FTSE to start the day we have the daily pivot at 5891 for support, but also a bullish picture just starting on the 2 hour chart with support at 5885. As such an early long around this area could be worth a go though I am alway cautious on NFP Friday. Its possible that we rise then dip on the news (buy the rumour, sell the news). We have resistance at the 5921 area where we have the 200ema on the 30min, but we are within a rising PRT channel on that time frame. If the 5871 (bottom of that channel), and just below those 2 other supports, holds then we could well be on for a rise initially. Mind you, if its anything like the recent volatility we might well rise to 6000 in one go! Or drop to 5800! So, generally looking to be long around the 5880 area first thing for an morning rise. If 5871 breaks then 5800 is likely, with the bottom of the 10 day Bianca at 5794. Stay cautious today!

Good morning.
Market Summary for Wednesday
The FT100 opened above 5900 but fell sharply in afternoon trade after U.S. data showed that the economy’s service sector expanded at a slower-than-expected rate, raising concerns that weakness in manufacturing was spreading to other areas of the economy. It briefly fell below 5800 before recovering into the close. A downgrade and poor figures in the finance and banking sector also put downward pressure on the index. Commodity shares performed better as the oil price rose by 5%.

Another day of 100+ swings in the FT100 shows that there is still danger in this market as the volatility continues.

US & Asia Overnight from Bloomberg
Asian stocks climbed with the region’s currencies as a selloff in the dollar underpinned a resurgence in crude oil.

A gauge of Asian shares rose for the first time in three days, led by mining and energy companies, while U.S. index futures advanced. Japan’s Topix index declined as the yen surged overnight. South Korea’s won rallied the most in three months and the ringgit climbed 1.5 percent after the dollar tumbled against a basket of other currencies on Wednesday. U.S. oilextended gains above $32 a barrel after jumping 8 percent in the previous session.

“The selloff in the U.S. dollar is supportive of commodities,” said Scott Schuberg, chief executive officer at Rivkin Securities, a brokerage in Sydney. “We’ve been trading under conditions that’s been fairly gloomy. The outlook for China has been gloomy for years now. I don’t really think that there’s too much negative sentiment that could be piled on to this market. Investors should start buying slowly.”

The dollar’s retreat was sparked by data showing the U.S. services sector grew at the slowest pace in nearly two years, underscoring the vulnerability of the American economy to unsteadiness abroad. The report tipped the fixed-income market’s balance closer toward zero rate hikes by the Federal Reserve this year, amid prospects central banks from Asia to Europe will act to quell the turmoil that’s roiled markets in 2016. The greenback’s drop helped boost the price of crude oil, along with speculation OPEC and other oil producing nations have agreed to an emergency meeting on market volatility.

China set a range for its economic growth target for the first time in 20 years, saying late Wednesday that the economy would likely expand 6.5 percent to 7 percent this year, slower than last year’s goal of about 7 percent. Gyrations in Chinese equity and currency markets unsettled global trading at the start of the year, with regulators’ response to the volatility fueling anxiety over their ability to manage the slowing economy.

Stocks
The MSCI Asia Pacific excluding Japan Index rose 0.7 percent at 2:49 p.m. Tokyo time, with Australia’s S&P/ASX 200 Index up 2.1 percent. BHP Billiton Ltd., the world’s biggest mining company, rallied for the first time in four days. The Hang Seng China Enterprises Index, a gauge of mainland Chinese stocks listed in Hong Kong, jumped 1.8 percent, while the Shanghai Composite Index advanced 1.1 percent. South Korea’s Kospi index gained 1.3 percent.

The Topix fell 1.1 percent, headed for its lowest close in more than a week.

Futures on the Standard & Poor’s 500 Index added 0.4 percent after the gauge climbed 0.5 percent last session, amid rallies in Exxon Mobil Corp. and Chevron Corp. [Bloomberg]

FTSE Outlook and Prediction

FTSE 100 Prediction

FTSE 100 Prediction

That was quite a sharp move down yesterday from 5920 to 5790 before an equally sharp recovery to bring us back above 5900. Certainly tricky conditions at the moment, though the long earlier in the day from the 5868 area worked out well for a gain. Volatile has certainly been the trend of the year so far! For today it actually looks fairly positive though there is resistance first thing at the 5945/5950 area so we may see an initial dip, which would work out well to test the 25ema on the 30min at 5910ish, which would be a decent long entry. Its NFP news tomorrow so something to bear in mind today and tomorrow morning, generally at the moment the news flow is fairly positive. Oil is holding steady around the $32 area as well. We have a pretty decent rising channel on the 10min chart as well at the moment with a rise to 6000 showing as possible, and with a cluster of resistance levels around here the bulls might have a bit of a job here. If it goes really bearish today (don’t think it will) then 5827 is the bottom of the 10 day Bianca, with 5800 bottom of the 10 day Raff. So, fairly simple trade plan at the moment, short term looks bullish up to 6000.

Good morning.
Market Summary for Tuesday
The main features of yesterday’s trading was oil prices down 5 percent as hopes for a deal between OPEC and Russia on output cuts faded, and continued poor economic data from China. Additionally the weak trading statement from BP knocked markets especially the oil sector.
The FT100 was down at the open and then drifted down for the whole day with a steeper decline after the Wall Street open. The 5900 level being breached after hours.
It was the usual pattern of the oil and commodity sectors being the worst performers and “safe” sectors which are non-cyclic performing best as a safe haven.
It turned into a trending day in the end so the long didn’t work out as any slight rally of 10/20 point was heavily sold into. Its looking like the 6120 area is going to be the short term high and we are on track for the 5700 this week or next. Oil also failed to breach that $35 level I mentioned a few times. Down to $16?

US & Asia Overnight from Bloomberg
Asian stocks fell, with the regional benchmark index heading for a second day of declines, as the rout in oil spurred a global selloff of risk assets amid deepening concern that global growth is weakening.

The MSCI Asia Pacific Index dropped 1.1 percent to 120.47 as of 9:08 a.m. in Tokyo. Oil’s collapse and worries about a China slowdown have continued to roil markets around the world, with the regional gauge sliding 7.8 percent this year through Tuesday. The slump in crude has taken its toll on energy producers, with BP Plc’s fourth-quarter profit tumbling 91 percent and Exxon Mobil Corp. cutting its drilling budget to a 10-year low.

“The underlying fundamentals are deteriorating and the talk of recession is getting louder,” Chris Weston, chief market strategist at in Melbourne at IG Ltd., said by phone. “When you see BP coming out with disastrous results and when you see Exxon cutting back on expenditures again, you realize the implication weak oil has on economies. How much more can central banks do from here?”

The Bank of Japan surprised markets with a stimulus boost last week, providing relief to turbulent markets around the world. The upturn was short-lived, as anxiety that the drop in oil and wider financial turmoil will impact growth took root. Citigroup’s Economic Surprise Index indicates data in Group of 10 economies is falling short of estimates by the most since May 2013. A gauge of service industries in China is due Wednesday.

Japan’s Topix index dropped 2 percent, heading for its second day of declines. South Korea’s Kospi index lost 0.7 percent. Australia’s S&P/ASX 200 Index slid 1.2 percent. New Zealand’s benchmark gauge retreated 0.6 percent.

Futures on the FTSE China A50 Index fell 0.9 percent in most recent trading, while those for Hong Kong’s Hang Seng Index dropped 1.3 percent. Chinese stocks climbed in light trading on Tuesday, led by technology and industrial companies, as the central bank injected cash into the financial system before markets close for holidays next week. The Shanghai Composite Index rose 2.3 percent, paring its decline this year to 22 percent.

E-mini futures on the Standard & Poor’s 500 Index slipped 0.1 percent on Wednesday. The underlying U.S. equity benchmark index declined 1.9 percent on Tuesday and the Dow Jones Industrial Average lost more than 290 points, as investors shunned risk assets across the world.

Crude futures capped the biggest two-day drop in New York in almost seven years before government data forecast to show U.S. crude stockpiles gained, exacerbating a global glut. Oil extended losses for a third day, sliding 0.8 percent on Wednesday. [Bloomberg]

FTSE Outlook and Prediction

FTSE 100 Prediction

FTSE 100 Prediction

I have some support at 5860 to start the day off today and after yesterdays declines we may well see a few brave bulls coming in around here for a rise up to the 200ema on the 30min at 5960ish. We are also at the bottom of the 10 day Raff currently, which is another reason why I think we may see a dead cat bounce today. Overall I am still expecting 5700 before too long and its firmly sell the rallies for the moment. The 2 hour chart is also bearish now, with resistance at 6018 currently, so if it were to pop above 600 towards this level then it will be worth a short there. We have todays pivot at 5932 which is why I am thinking any initial rise will stall at that area, and then 5960 above that. The early test for the bulls will be the 25ema on the 30min at 5883 so I have gone for a little drop back from here to the 5860 level then the bounce most likely around 7am. So, whilst big picture is still pretty bearish and I think we are still looking at a lot more downside, today could see a bit of selling respite. The divi today is 2.9 which is applied to any open position at either 1630 or 9pm so bear that in mind, its not large enough to bring out the divi hunters though.

Support 6024 6000 5972 5950
Resistance 6053 6060 6078 6127 6206

Good morning.
Market Summary for Monday
The FT100 still showed high volatility by swinging more than 100 points during the day. It breached 6100 at the open then fell briefly below 6000 soon after Wall Street opened. The oil price again seemed to be the main driver as it has become a proxy for the state of the global economy. It fell most of the day from $34 to $31.5. As a result the oil (and commodity) sectors were some of the worse performers yesterday with oil consumers such as travel shares benefiting. All in all it was a pretty bearish day down to 6000, with just a small bounce for that 6040 long in the end, showing the importance of getting the stops to breakeven as soon as possible. However, it was a good fight back from the bulls from 6000, managing 6085 out of hours though its slipped back overnight. Still thinking 6050/6150 area is a short term top, especially as oil looks to have slipped (pun intended!) from the $35 area possibly en route to $16.

US & Asia Overnight from Bloomberg
Asian stocks dropped, with the regional benchmark index heading for its first decline in five days, as material and energy shares led losses after oil resumed its selloff amid signs China’s economy is deteriorating.

The MSCI Asia Pacific Index slid 0.3 percent to 122.29 as of 9:01 a.m. in Tokyo. The gauge on Monday capped its longest winning streak of the year, gaining 4.1 percent in four days, as optimism grew that central banks around the world will support financial markets. Crude tumbled Monday after China’s official factory gauge signaled a record sixth straight month of deterioration.

“We’re in for a period of continuing caution,” Angus Gluskie, a managing director who oversees $550 million at White Funds Management in Sydney, said by phone. “It’s a period of uncertainty. China remains the biggest concern for investors. If the Chinese situation develops more adversely, it could have greater ramifications.”

Federal Reserve Vice Chairman Stanley Fischer said on Monday that the impact of recent market turbulence on U.S. growth could factor into decision-making, helping U.S. stocks shrug off the oil slump to close little changed. Futures on the Standard & Poor’s 500 Index fell 0.4 percent on Tuesday.

Japan’s Topix index lost 0.8 percent, after rallying more than 5 percent over the previous two days on the Bank of Japan’s unexpected stimulus boost. South Korea’s Kospi index slid 0.6 percent. New Zealand’s benchmark gauge added 0.2 percent. Australia’s S&P/ASX 200 Index retreated 0.6 percent before the nation’s central bank reviews its monetary policy.

China Futures
Futures on the FTSE China A50 Index added 0.2 percent in most recent trading, while those for Hong Kong’s Hang Seng Index slipped 0.2 percent. The Shanghai Composite Index slumped 1.8 percent on Monday after official factory gauge signaled a record sixth straight month of deterioration, raising the stakes for policy makers struggling to prop up the economy amid a second bear market in stocks since June and a currency at a five-year low.

Crude futures fell as much as 0.9 percent on Tuesday after slumping 6 percent on Monday. U.S. inventories probably rose by 3.75 million barrels last week, according to a Bloomberg survey before an Energy Information Administration report Wednesday. [Bloomberg]

FTSE Outlook and Prediction

FTSE 100 Prediction

FTSE 100 Prediction

Initially it looks like 6055 is a fairly key area as we have the daily pivot here and also a 30min coral trend change with resistance here too. As such I think this level will be worth an early short. With the drop off the 6120 area yesterday and the oil price dropping, I think the FTSE might be nearing the end of its run up from 5600. If 6000 breaks then there is S1 at 5980, and then 5950 below that were we have the 10 day Bianca channel, and the daily EMAs. Above 6055 then its likely to reach 6100 again (it could infact probably go to 6200 and then drop and still keep the bearish future intact) where we have a PRT resistance on the the 30min, with 6140 above that for the channel. Given recent volatility, if it breaks above 6055 then going long is worth a go to target those areas, even though I haven’t put that on the trade plan below, mainly as the 100 Hull MA on the 2 hour has resistance at 6078. Google results last night drove the US markets up, but the FTSE only managed 6080 (US markets have since fallen back as well). Generally I am not felling overly bullish at the moment, despite us holding above 6000 yesterday, and the main resistance levels I am watching today are 6055, 6078, 6105 and 6127.

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