Good morning. Well here we go with a new month, this year seems to be zipping by. Focus currently has swung to interest rates and when and who will be raising them first. Yellen is kind of backed into a bit of a corner for a rise next month so we shall see.I imagine the US will raise and then the UK will follow suit. Don’t want to do it too early though as we seem to be having a pre crisis rush for debt with loads of people leveraging themselves up while money is cheap. Lets hope they can sustain it with a 3 or 4% interest rate, otherwise hello recession. Again. Greek markets open today after a 5 week suspension, while talks are still ongoing about the austerity measures and debt relief reforms.

US & Asia Overnight from Bloomberg
Asian stocks fell for the first time in four days as data showed a Chinese factory gauge slipped to a five-month low and energy shares retreated amid a drop in oil.

The MSCI Asia-Pacific Index slipped 0.3 percent to 141.67 as of 9:07 a.m. in Tokyo. The measure lost 0.4 percent last week for a second weekly decline. The official China Purchasing Managers’ Index was 50 in July, compared with the median estimate of 50.1 in a Bloomberg survey and down from June’s 50.2. Energy shares sank as crude futures in New York slid as much as 1.6 percent after Iran claimed it will be able to bolster production a week after sanctions are lifted.

“China will have several hard questions asked of it over the week, feeding into concern it’s facing a hard landing,” Evan Lucas, a markets strategist in Melbourne at IG Ltd., wrote in an e-mail to clients. “We see a slightly negative start to August.”

Japan’s Topix index fell 0.1 percent. More than 70 companies in the nation’s benchmark gauge are scheduled to report earnings today.

Australia’s S&P/ASX 200 Index added 0.1 percent. South Korea’s Kospi index fell 0.4 percent. New Zealand’s NZX 50 Index gains 0.5 percent. Markets in Hong Kong and China are yet to open.

Futures on the FTSE A50 Index of China’s largest companies advanced 0.4 percent in most recent trading. The Shanghai Composite Index resumed a decline last week, tumbling 10 percent after three weekly gains. Most of the loss came on July 27, when the Chinese measure tumbled 8.5 percent for its largest daily slump since 2007.

China, Oil
A final reading of a private gauge of Chinese manufacturing due Monday is expected to show further contraction in the sector.

West Texas Intermediate crude declined as much as 1.6 percent after capping its worst month since 2008 in July amid concern over a global supply glut. Iranian production can increase by 500,000 barrels a day within a week after sanctions end, and by 1 million barrels a day within a month following that, state-run Islamic Republic News Agency said.

E-mini futures on the Standard & Poor’s 500 Index gained 0.1 percent after the underlying equity measure lost 0.2 percent on Friday in New York. [Ref]

FTSE Outlook

FTSE 100 Prediction

FTSE 100 Prediction

Todays pivot is 6681 and I think that might well hold as support initially. Typical hr start of a new month is fairly bullish as we see a decent amount of buying, certainly first thing. If the pivot does hold then I can see a rise to the top of the 30min channel at 6720, before dropping back. I have put in another leg up though after that to the top for he 10 day Bianca channel at 6740. If we get that high today then a 60 point rise might well be worth a short from that level. Above that there are some daily resistance levels at 6770 and6780. Support wise, below the pivot we have the bottom of that 30min channel and fib 1 at 6655, so this could well be a good place for another long. Generally I think August might be fairly bullish and if so we may even see 7000 again this month. If the 6655 area breaks though then we may follow Australia’s lead and in fact be bearish today.

Good morning. End of July already, doesn’t time fly! Yesterday remained pretty bullish as expected unfortunately not quite dipping to the 6620 order level. That said, the bears had a good go off 6700, timing that drop with some Greek news (still simmering away in the background). Talks over an €86bn bail-out for Greece have been thrown into turmoil after just four days as the International Monetary Fund said it would have no involvement in the country until it receives explicit assurances over debt sustainability. An IMF official said the fund would withhold financial support unless it has guarantees Greece can carry out a “comprehensive” set of reforms and will be the beneficiary of debt relief from its European creditors.

US & Asia Overnight from Bloomberg
Asian stocks advanced, while the dollar headed for its biggest monthly increase since January on speculation the Federal Reserve is moving closer to raising interest rates. Oil extended its worst monthly rout this year.

The MSCI Asia Pacific Index rose a third day, adding 0.5 percent by 1:55 p.m. in Tokyo and paring its July drop to 3.3 percent. Japan’s Topix index increased 0.5 percent and Australian shares strengthened. The Shanghai Composite Index lost 1 percent and U.S. stock futures fell 0.1 percent. The Bloomberg Dollar Spot Index headed for a 2.5 percent monthly gain. U.S. crude sank 0.7 percent and gold slid 0.4 percent.

The dollar’s ascendence in July amid mounting bets on a U.S. rate rise in September has cascaded through financial markets, hitting commodities already in retreat on supply gluts. Emerging markets have been a chief casualty, with the wild gyrations in Chinese equities dealing another blow. Developing-nation stocks are headed for their worst month since 2012 and currencies have slumped 8 percent this year.

“The U.S. dollar remains supported by the looming Fed tightening cycle,” Imre Speizer, a senior market strategist at Westpac Banking Corp. in Auckland, said by phone. “As we get closer to that date and get possible clues from speeches by officials over the next few weeks, I expect the dollar to auto-resume its upward trend.”

Commodity-linked currencies have borne the worst losses, with Brazil’s real, the Australian dollar, Canada’s loonie and the South African rand among the five biggest decliners against the dollar in July, down at least 3.9 percent. The euro emerged from the Greek crisis with a 1.8 percent drop, while the pound performed best among its 16 peers, slipping 0.7 percent.

Oil, Gold
The Bloomberg Commodity Index has lost 9.8 percent in July, the most since September 2011, after sinking to a 13-year low.

West Texas Intermediate oil slumped 19 percent, its worst monthly performance since December, while gold fell 7.5 percent and is set for its biggest drop since 2013 after falling to a five-year low. Copper slid 8.7 percent in July.

Emerging-market stocks are heading for their biggest drop in any month since 2012. The Shanghai Composite Index has tumbled 14 percent, the biggest loss among 93 global benchmark gaugestracked by Bloomberg, as margin traders cashed out and new equity-account openings tumbled amid a $3.5 trillion rout.

Japanese stocks rose on Friday, with the Topix index set to cap an increase in July, as investors watched quarterly results from more than 300 companies, the busiest day in the earnings season. Finance companies and shippers gained, while commodity industries fell.

Yellen Guidance
Shares of Noble Group Ltd. slumped 13 percent in Singapore. The stock has lost more than 60 percent since the middle of February when a group calling itself Iceberg Research published criticism of its accounting, which the firm has rejected.

While China concerns contributed to losses in Asian equities in July, better-than-expected profits in the U.S. helped boost the Standard & Poor’s 500 Index by 2.2 percent. The MSCI All-Country World Index has gained 0.5 percent, with the Stoxx Europe 600 Index up 3.9 percent, the most since February. An update on euro-area consumer prices is due Friday.

U.S. gross domestic product rose at a 2.3 percent annualized rate in the second quarter, the Commerce Department said Thursday, after a previously reported contraction for the first three months was revised to a 0.6 percent gain. The median forecast of 80 economists called for a 2.5 percent advance.

Fed Chair Janet Yellen is guiding the central bank toward its first rate increase in almost a decade as the U.S. approaches full employment. The Fed said in a statement Wednesday that it will tighten monetary policy once it sees “some further improvement in the labor market.” Economists have put the chance of a rate increase at the Fed’s September meeting at 50 percent. [Ref]

FTSE Outlook

FTSE 100 Prediction

FTSE 100 Prediction

I think yesterday general bullish sentiment will continue going into the end of July and probably remain for August as well. As such, buy a dip down to the pivot at 6666 today could well be a decent trade for another test of the 6700 level and probably a break. There are a few resistance levels of note just above that though, 6707, 6730 and 6780. We have pretty decent rising channels on both the 10min and 30min charts, but just need to be mindful of the fact that we are testing the top of the 10 day channels, both Raff and Bianca. As such the bulls have momentum, but a hurdle to jump as well. Support below the pivot is 6625 and 6620, the latter should provide decent support if it were to get that low.

Dax Analysis

Dax Trade Analysis

Dax Trade Analysis

The 11210 long worked well if you left it alone, as the stop didn’t get triggered and it ran to target. For today, the pivot is 11236 so support from this, though there is a decent rising 10min channel in play with support at 11260 first. The 30min channel is wider, with support at 11170 and resistance at 11340ish.

SHORT 11340, stop 11360, target 11300 or lower
LONG 11236 off the pivot, stop 11220, target 11300+

Dax Analysis

Dax Prediction

Dax Prediction

Pretty much the same plan, long off the pivot at 11210 today. It also is just testing the top of the 10 day Raff at 11252 this morning, so a little dip back would be good to get long on. Top of the 10 day Bianca is also at 11265. Above these resistance is 11295. Support below the pivot is 11140 and 11100

LONG 11210, stop 11190, target 11295+

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