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+

Good morning. Nice early drop from the 6612 yesterday for a few points before the rally back towards the 6620/30 area as the Fed announcement got nearer. September 2015 is still being mooted as the likely rate rise time, so we shall see. I think ti might even be later in the year. We have just popped above the 10 day Bianca channel at 6619 so I expect this area to be back tested today, and as we also have the daily pivot there, for it to act as support for a push higher, certainly this morning. Things feel like they are recovering from the lows on Monday, helped by the UK GDP coming in at 0.7% yesterday for the second quarter.

US & Asia Overnight from Bloomberg
Asian stocks rose, following gains in global shares, as profits topped estimates and the Federal Reserve said the U.S. economy was progressing toward an interest-rate increase.

The MSCI Asia Pacific Index climbed 0.2 percent to 141.04 as of 9:01 a.m. in Tokyo. While Fed policy makers said the labor market and housing had improved, they didn’t provide a clear signal on the timing for rate increases, in a statement issued after their meeting. Economists had put the chance of a September increase at 50 percent.

Equities in the U.S. and Europe climbed as earnings from Bayer AG to General Dynamics Corp. topped expectations. Facebook Inc. declined in extended trading. Nomura Holdings Inc. rose 3 percent in Tokyo after first-quarter profit more than tripled as surging brokerage commissions and investment-banking fees outweighed a drop in trading income. Daiwa Securities Group Inc. advanced 3.3 percent after also posting a larger-than-anticipated earnings increase.

“Nothing has really changed with the Fed’s stance,” Evan Lucas, a markets strategist in Melbourne at IG Ltd., said by phone. “Earnings have been reasonable and there have been some bright spots. We expect to see a fairly good gain today” in equity markets, he said.

Japan’s Topix index advanced 0.8 percent. Australia’s S&P/ASX 200 Index gained 0.2 percent and New Zealand’s NZX 50 Index rose 0.2 percent. South Korea’s Kospi index added 0.2 percent. Markets in China are yet to open.

China Futures
Futures on the Hang Seng China Enterprises Index, a gauge of Chinese stocks listed in Hong Kong, and contracts on the Hang Seng Index gained 0.6 percent. FTSE China A50 Index futures were little changed and contracts on the Shanghai Shenzhen CSI 300 Index climbed 2 percent in recent trading.

The Federal Open Market Committee described job gains as “solid,” and it dropped the modifier “somewhat” to describe a decline in labor-market slack. At the same time, policy makers refrained from signaling the probable timing of the first rate increase since 2006, keeping market expectations focused on a move as soon as September.

Futures on the Standard & Poor’s 500 Index slipped 0.1 percent. The underlying gauge gained 0.7 percent on Wednesday. [Ref]

FTSE Outlook

FTSE 100 Prediction

FTSE 100 Prediction

I have a fairly simple plan for today and that is to buy the dip to around the pivot area and plan for 6659 and 6670 or more. If the pivot area breaks then the next support is the 200ema on the 30min at 6600, with 6590 and 6575 below that. Resistance wise, there is a pretty decent 30min channel in play with resistance at 6670+ (depending on when it hits the top of the channel), along with daily chart resistance from the 25ema at the 6659 level. However, the S&P reversed it bearish EMAs pretty easily earlier in the week so it will be interesting to see if the FTSE does the same thing; if it breaks that 25 ema then 6715 looks a likely point it will rise too quite quickly. So, bullish for the moment.

Good morning. A bit unfortunate yesterday for my long order at 6520, as the low was 6521.3 and miss, before getting the rise to 6591 as expected, though it took all day to get there. Today it will be all eyes on the Fed and the prospect of rate rises, though a poor consumer confidence report out in the US yesterday might temper any enthusiasm to raise rates in September. I think he UK will follow the US lead and wait to see the effect of raising rates. Don’t want to do it too soon really….

US & Asia Overnight from Bloomberg
Asian stocks rose for the first time in six days, following U.S. and European shares higher, as investors awaited an update on monetary policy from the Federal Reserve.

The MSCI Asia Pacific Index gained 0.4 percent to 140.85 as of 9:02 a.m. in Tokyo. Better-than-estimated earnings from Pfizer Co. to Ford Motor Co. and mergers among European companies fueled Tuesday’s rally outside Asia, with a gauge of global stocks snapping a five-day slump. Traders will be combing the Fed’s post-meeting statement on Wednesday as policy makers assess the strength of economic growth amid plunging commodity prices and Chinese financial-market turmoil.

“Often when a lot of stocks get washed out, we get a rebound,” Nader Naeimi, Sydney-based head of dynamic asset allocation at AMP Capital Investors Ltd., which oversees A$160.5 billion ($117 billion), said by phone. “The Fed will be focused on global conditions. What’s happening globally can’t be totally ignored.”

While economists see no chance the central bank will raise rates this week, they put the odds of a September boost at about 50 percent, a Bloomberg survey published July 22 showed.

Fed Chair Janet Yellen has signaled that the central bank is likely to lift rates this year, and emphasized that the pace of subsequent increases would be gradual. Data showed consumer confidence slumped in July by the most since August 2011 as Americans became less upbeat about prospects for the economy, employment and their finances.

Japan’s Topix index gained 0.5 percent. Fanuc Corp. slumped 0.8 percent in Tokyo after lowering its full-year profit forecast as demand from the information-technology industry declines.

Australia’s S&P/ASX 200 Index advanced 0.4 percent and South Korea’s Kospi index added 0.8 percent. New Zealand’s NZX 50 Index was little changed.

China Futures
Futures on the FTSE China A50 Index, a gauge tracking the country’s biggest mainland stocks, added 1.1 percent in most recent trading, while contracts on the broader Shanghai Shenzhen CSI 300 Index were down 2 percent. The Shanghai Composite Index ended Tuesday 1.7 percent lower, paring a slump of as much as 5.1 percent following Monday’s 8.5 percent tumble.

Hang Seng China Enterprises Index futures and contracts on the Hang Seng Index both rose 0.3 percent. E-mini futures on the S&P 500 were little changed. [Ref]

FTSE Outlook

FTSE 100 Prediction

FTSE 100 Prediction

So far yesterdays 6591 has held as resistance still so with the daily pivot and the bottom of the 30min channel at 6560 I am thinking that we have an initial drop to this level (maybe a slow drop). It might be a fairly flat day while we await direction from the Fed once again, with rates expected to stay the same for the moment but looking for clues as to when they may or may not rise. Below the pivot we have support at 6535, with the bottom of the 20 day Bianca below that at 6476. Not sure it will get that low today.

Above the 6591 resistance area we have the 200ema on the 30min, followed by the 10 day Bianca at 6612 which may be worth a small short, followed by the tops of those 10min and 30min PRT channels both at 6622. We then have 6657 with the 25ema on the daily as a possible stronger shorting area. Generally I think it will be fairly flat till later (7pm) when the Fed roll into town.

Good morning. Well now we have China having a wobble again as the next thing to drive markets lower, which they certainly did yesterday. However, having had a low just below 6500 yesterday the FTSE has bounced back overnight and risen to 6545. A dip from here and then further rises will play out nicely with the moving averages, and that decent bearishness might curtail any rate rises in the near future – maybe pushing back the Fed’s mooted September date. we will find out on Wednesday when they might give us a bit more of a clue. Greece also threw a bit of a spanner in the works yesterday with leaking of the plan for a dual currency – something that everyone had joked about as using the Drachma on the black market had become a standing joke, with a grain of truth it turns out!

US & Asia Overnight from Bloomberg
Asian stocks dropped after a rout in Chinese equities drove global shares lower.

The MSCI Asia Pacific Index declined 0.7 percent to 139.94 as of 9:04 a.m. in Tokyo, extending its five-day fall to 3.7 percent. The Shanghai Composite Index plunged the most in eight years on Monday, intensifying concern government efforts to prop up shares are unsustainable. The turmoil bolstered speculation the Federal Reserve will keep U.S. interest rates lower for longer.

“Extreme caution is needed here,” said Matthew Sherwood, Sydney-based head of investment strategy at Perpetual Ltd., which manages A$33 billion ($24 billion). “The return of market volatility in China will be a significant discussion point at the U.S. Fed. in terms of what this is telling us about the Chinese economy. There is a lot of global weakness and significant external risk.”

Japan’s Topix index declined 1.2 percent as the yen held three days of gains to trade at 123.27 per dollar. South Korea’s Kospi index retreated 0.6 percent and Australia’s S&P/ASX 200 Index slid 0.4 percent. New Zealand’s NZX 50 Index lost 0.3 percent.

After the 8.5 percent slide in the Shanghai Composite, the Standard & Poor’s 500 Index declined 0.6 percent at the close in New York on Monday, falling for a fifth day. European stocks sank 2.2 percent and emerging-market shares lost 2 percent.

Continued Support
China’s securities regulator assured investors the government hasn’t withdrawn support for equities.

The China Securities Regulatory Commission will continue to “stabilize” the market and “prevent systemic risk,” spokesman Zhang Xiaojun said in a statement on Monday. He was responding to media reports saying the government was pulling back from support measures adopted after the China’s stock market began tumbling last month, according to the statement.

The International Monetary Fund recently urged China to unwind its support measures, saying share prices should be allowed to settle through market forces, a person familiar with the matter said last week.

Futures on the FTSE China A50 Index, which tracks the largest Chinese companies, slipped 0.2 percent in most recent trading. Contracts on a gauge of mainland shares listed on Hong Kong lost 0.6 percent.

E-mini futures on the S&P 500 rose less than 0.1 percent. [Ref]

FTSE Outlook

FTSE 100 Prediction

FTSE 100 Prediction

An overnight rise to 6545 looks good for an initial pullback towards the 6520 area where there is, at present, some decent support. As such a long from this area for another test of 6545, and possibly onto 6590 looks a decent set up, certainly for this morning. The US bulls will be hoping that the current bearishness makes the Fed think twice about rate rises in September, and to be honest I think its too soon to raise interest rates. The housing market in the UK is certainly going to get a shock when they start going up. I’ve always thought it would make more sense to have a fixed rate for the life of the mortgage rather than trying to make everyone gamble on what rates are going to do, but anyway. Back to the FTSE and if the bulls break 6545 then the top of the 30min channel at 6575 comes into play, with 6590 above that. The lows from yesterday at 6495 are the support for today if 6520 breaks, and we also have the bottom of the 30min channel at 6490. Todays pivot is 6529 which wasn’t much resistance on that overnight rise, but might hold as support on this dip back from 6545 (which has started while writing this). Generally, despite all the headlines and bearish press around, I think a rise is on the cards.

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