Support 5567 5551 5540 5500 5436 5403
Resistance 5585 5605 5620 5661 5663  5696

Good morning.
Market Summary for Thursday
Another day of falls which were again aggravated by worries over the banking system and world economic growth.
The speeches by the FED’s Yellen yesterday and today appeared hesitant and lacking clarity which also did little to give investors confidence.
The sector to suffer most was clearly financials, with gold the standout sector to the upside as investors ran for cover into safe assets.
After an initial big fall near the open the FT100 tried to claw back during the day only to hit more selling into the close – which is never a particularly good sign. News alerts last night confirmed that global markets have now officially entered a bear market.

US & Asia Overnight from Bloomberg
Asian stocks fell, with the regional benchmark index heading for its biggest weekly decline in a month, after global equities sank into a bear market and Japanese shares extended losses as the yen strengthened.

The MSCI Asia Pacific Index dropped 1.7 percent to 114.50 as of 9:11 a.m. in Tokyo. The gauge is headed for a 4.9 percent decline this week. The Topix index slipped 4.1 percent as the market resumed trading following Thursday’s holiday. Combined losses in U.S. and European equities dragged the MSCI All-Country World Index down 20 percent from a record reached in May, the common definition of a bear market.

Central bank activity remained in focus as negative interest rates have eclipsed investor worries over China’s fading economy and the near two-year collapse in oil prices. Sweden lowered interest rates that are already below zero, about two weeks after Japan shocked markets by imposing negative rates in a bid to quell the turmoil. Investors ignored a second day of testimony from Janet Yellen, whose indication that the Federal Reserve won’t rush to raise benchmark interest rates in the face of global ructions failed to stem the selloff in risk assets.

“Markets are losing faith in the central banks and their ability to stabilize the situation,” Matthew Sherwood, head of investment strategy at Perpetual Ltd. in Sydney, which manages about $21 billion, said by phone. “Central banks will have to think of unconventional policies they can implement. The global economy is extremely weak.”

The Topix is trading at the lowest level since October 2014, poised for its biggest weekly decline since October 2008 as the yen traded near a 15-month high. Bank of Japan Governor Haruhiko Kuroda will speak in parliament later today. South Korea’s Kospi index fell 0.5 percent. New Zealand’s S&P/NZX 50 Index lost 1.2 percent. Australia’s S&P/ASX 200 Index slid 0.8 percent.

Futures on the Hang Seng Index slipped 1.4 percent in their most recent trading, while those for the Hang Seng China Enterprises Index lost 1.6 percent. Hong Kong stocks fell Thursday in their worst start to a lunar new year since 1994 as the global equity rout deepened. Markets in mainland China, Taiwan and Vietnam remain closed for the holidays.

E-mini futures on the Standard & Poor’s 500 Index climbed 0.3 percent on Friday after the underlying U.S. equity benchmark index finished 1.2 percent on Thursday.

West Texas Intermediate oil jumped as much as 4.7 percent Friday in New York. The contract slumped 4.5 percent on Thursday as crude stockpiles at the delivery point for New York futures expanded to a record. [Bloomberg]

FTSE Outlook and Prediction

FTSE 100 Prediction

FTSE 100 Prediction

We have had a decent bounce so far off the 5500 level tested yesterday and the 30min chart looks bullish to start things off today. The problem is that we have been here before this week and by 07:15 its gone all bearish and drops 100! There is certainly a lot of panic and fear out there at the moment, most of it justified, and with markets now officially entering a bear market (20% off their highs) the average Joe is going to start getting a bit concerned. However, just taking the contrarian view for a moment there is pretty good support showing at 5540ish for today so worth a long here on any dip down to that level. There is the top of the falling 30min channel at 5600 so the bulls will be keen to break this level going into the weekend. Below 5540 then we have the 5500 level again, and then 5436 for the bottom of the 10 day Bianca, followed by 5400 where we have the Raffs. So, any weakness from the bulls today and we are looking at steep declines again. That said, I think the bulls are waiting in the wings for the news flow to start being a bit more positive. We have a load of data out today on retail and GDP figures so I wouldn’t be surprised if we get a decent rally shortly. News flow usually is 2 weeks negative, 2 weeks positive at the moment. With the markets the way they are at the moment its makes pinning your colours to the mast extremely hard, as the picture is changing quite rapidly but I think a long around the 5540/5550 area today could work out well if we dip down to that.

Support 5608 5604 55815579 5494 5476
Resistance 5645 5647 5650 5681 5717 5766
Good morning.
Market Summary for Wednesday
After a bumpy opening the FT100 ground its way up during the day on a reassuring statement from Deutsche Bank which helped the banking sector and markets overall.
A statement from the FED caused a small blip down near the Wall Street open but then the FT100 rose again during the afternoon before falling back slightly into the close at 4:30pm. Financials were among the best performers with gold and commodities the weakest.
Chair Janet Yellen said the Federal Reserve still expects to raise interest rates gradually while making it clear that continued market turmoil could throw the central bank off course from the multiple increases that policy makers have forecast for 2016.
“Financial conditions in the United States have recently become less supportive of growth,” Yellen said in testimony prepared for delivery Wednesday before the House Financial Services Committee in Washington. “These developments, if they prove persistent, could weigh on the outlook for economic activity and the labor market.”

US & Asia Overnight from Bloomberg
Asian stocks fell as markets in Hong Kong and Seoul joined a global selloff in their first day of trading this week.

The MSCI Asia Pacific Excluding Japan Index dropped 1.2 percent to 367.19 as of 9:35 a.m. in Hong Kong. Markets in mainland China, Japan, Taiwan and Vietnam are closed for holidays. The Hang Seng Index slumped 4.1 percent in Hong Kong, while South Korea’s Kospi index tumbled 2.5 percent. A gauge of worldwide equities slid 2.3 percent in the first three days of the week amid concern about the outlook for the global economy and as oil extended its slide.

“We’re seeing a contagion from what’s been going on in the last three days in global markets,” Tim Condon, head of Asian research at ING Groep NV in Singapore, said by phone. “This is the first day South Korea and Hong Kong are registering a sort of reaction to that. It’s a huge down day. Financial markets are repricing for a global growth slowdown. Expectations that monetary policy would be able to do much have diminished considerably.”

Federal Reserve Chair Janet Yellen on Wednesday highlighted uncertainty over the pace of China’s growth and the related rout in commodities, concerns that have roiled financial markets throughout the year and twice pushed global shares to the brink of a bear market. Yellen told Congress the Fed still expects to raise rates gradually while making it clear that continued market turmoil may alter its forecasts. Her dovish-sounding comments weren’t enough to boost U.S. equities.

The Hang Seng China Enterprises Index of mainland shares listed in Hong Kong slumped 5.1 percent on Thursday.

The Kospi index is trading for the first time since North Korea launched a long-range rocket on Feb. 7. South Korea is pulling out of an industrial complex jointly run with North Korea, taking aim at their last remaining symbol of economic cooperation to punish leader Kim Jong Un for a recent nuclear test and rocket launch.

Australia’s S&P/ASX 200 Index added 0.2 percent, after falling into a bear market on Wednesday when it plunged to its lowest level since July 2013. New Zealand’s S&P/NZX 50 Index lost 0.4 percent, while Singapore’s Straits Times Index slipped 1 percent.

Markets in mainland China, Taiwan and Vietnam remain closed for the rest of the week, while those in Japan will resume trading on Friday.
E-mini futures on the Standard & Poor’s 500 Index fell 0.7 percent after the underlying U.S. equity benchmark index closed down less than 0.1 percent on Wednesday, with gains of as much 1.6 percent evaporating in the final hour of trading.

Crude oil futures fell below $27 a barrel on Thursday after after dropping 15 percent the previous five sessions. [Bloomberg]

FTSE Outlook and Prediction

FTSE 100 Prediction

FTSE 100 Prediction

We had a quick foray below 5600 overnight but the algo’s managed to drag it backup above, however it still looks pretty weak. That said, I can see a possible bounce up to the 5645 area, where we have a couple of decent looking resistance levels and an area that is probably worth a short. The bulls can’t seem to make any of their rises stick at the moment, especially harder with so much negative sentiment around, as well as a dose of fear about the markets/economy/debt/interest rates/oil/commodities/company profits/war/etc! Anyway, we have the daily pivot at 5645, as well as the coral trend line on 30min which has just turned to bearish (short term trend is down that means). If 5600 breaks then there is quite a lot of fresh air below and we are looking at a possible dip to 5400. Oil has continued its slide from the $35 area, and still looks like we will dip to $16, though whether it actually does remains to be seen. I’m like a broken record on that oil price! Sorry. So, an initial second test of the 5595 area is likely to hold I think, as the bulls will want to keep us above 5600 if possible, though a third test later today is likely to break I feel. On the flip side, if the bulls can break 5645 then short term crisis averted and a rise to 5766 is possible, where we have the top o0 the 10 day Bianca channel.

Support 5616 5578 5538 5520
Resistance 5650 5657 5665 5666 5837

Good morning.
Market Summary for Tuesday
The markets were affected by global banking issues with worries about Greece and Deutsche Bank to the fore.
As has been the pattern over the last few trading days markets try and get off to a strong start but then weaken during the day as sellers reappear.
There were some support levels around 5750 so this level will act as a focus for traders in the next couple of days, but currently 100 points below that level.
In a reverse of previous days the commodity sector sold off quite dramatically whereas safer shares were the least affected by the downturn.
There was also some bargain hunters for tech shares and tourist related shares outperformed which had been sold off recently.

US & Asia Overnight from Bloomberg
Asian stocks dropped as a week of volatile trading in global equities continued, with Japanese shares extending losses after the biggest one-day plunge since August.

The MSCI Asia Pacific Index slipped 0.9 percent to 117.06 as of 10:16 a.m. in Tokyo, poised for the lowest close since Jan. 21. Japan’s Topix index is heading toward the lowest close since October 2014. A gauge of global equities and the Nasdaq Composite Index edged nearer to a bear market, while the Standard & Poor’s 500 Index traded at the lowest since April 2014 amid declines in energy and technology shares. Crude tumbled almost 6 percent before rebounding on Wednesday.

“Contributing to the drop in oil and certainly having a large impact on the drop in equities is this growing concern about the sustainability of the recovery, the state of economic growth in China and increasingly the state of growth in the U.S.,” Russ Koesterich, global chief investment strategist for New York-based BlackRock Inc., said on Bloomberg TV. “People are getting worried about the global recession, worried about growth, which is affecting not only oil and stocks but other risky assets as well.”

The Topix slipped 1.5 percent in Tokyo as the yen strengthened. The gauge is currently trading below the lowest levels of January’s selloff. Traders are paying more attention to the volatility sweeping global markets than the Bank of Japan’s monetary easing, with the yen climbing against almost all of the more than 150 currencies tracked by Bloomberg since the central bank embraced negative interest rates on Jan. 2.

As global stocks near a bear market, volatility is on the rise, with the Chicago Board Options Exchange Volatility Index briefly touching a five-month high. The measure of market turbulence known as the VIX jumped 20 percent in the prior three days. A similar gauge for the Nikkei 225 Stock Average is at the highest level since August, jumping 30 percent on Tuesday.

Investors will be watching Federal Reserve Chair Janet Yellen as she testifies before the U.S. Congress on Wednesday. After the Bank of Japan’s surprise move into negative interest rates largely failed to assuage market concerns, Yellen will need to calibrate her commentary carefully to avoid further fueling volatility.

Australia’s S&P/ASX 200 Index fell 1.3 percent, retreating for a fourth day to the lowest level since July 2013. New Zealand’s benchmark dropped 0.4 percent. Singapore’s Straits Times Index declined 2.7 percent while the FTSE Bursa Malaysia KLCI Index was little changed, resuming trading following an extended weekend Lunar New Year holiday. Markets in South Korea, Hong Kong, China, Taiwan and Vietnam remain shut.

U.S. Futures
E-mini futures on the S&P 500 Index slipped 0.1 percent on Wednesday. The U.S. equity benchmark index fell 0.1 percent on Tuesday, after erasing a 1 percent loss and climbing as much as 0.8 percent. The Nasdaq Composite Index fell 0.4 percent after lurching between gains and losses.

Oil snapped a four-day losing streak, rebounding from the lowest close in almost three weeks before U.S. crude inventory data. Futures gained as much as 1.8 percent in New York after slumping 13 percent in the previous four sessions. U.S. industry data was said to report crude supplies climbed 2.4 million barrels last week. Government figures Wednesday are forecast to show a 2.85 million-barrel increase, according to a Bloomberg survey. [Bloomberg]

FTSE Outlook and Prediction

FTSE 100 Prediction

FTSE 100 Prediction

Well yesterday morning started off going to plan, but the bulls couldn’t quite reach the 5745 short order (failed at 5741… arghhh) and well, the next thing you know its testing 5600. The bulls defended this area pretty well as the next really major level below is 5400 (though there is some support at 5550 first). Bear that in mind. Anyway, for today, its looking like an initial rise up to the top of the 10 and 30min channels as well as the daily pivot area at 5652 to 5666, so it will be interesting to see if there are any bears waiting here as it could be a good shorting spot. If the bulls manage to break through 5666 then we could be on for a bit of a bounce for a few days and pull away from the 5600 area. If the short from this area gets stopped then it would be worth flicking to long to ride any possible bounce towards 5700+. As mentioned, if the bears do bring it down from 5666 then I am looking at a potential drop to 5580ish, maybe a bit lower. The volatility continues at the moment and its certainly a bit tricky, so stay nimble and keep the stops tight!

Support 5684 5670 5660 5630 5620 5608
Resistance 5695 5747 5771 5800 5833 5901

Good morning.
Market Summary for Monday
Another day of big negative moves with the FT100 dropping by 2.7%. Initially it appeared there may be a bounce from Friday’s close as the FT100 moved at the open above 5850 however worries about the banking system soon drove prices downwards for most of the day. Finishing below 5700 this is over 1300 points down from the summer peak! The worst performing sector was financials with commodity shares surprisingly strong. Out of hours the FTSE managed to climb to 5735 however its again dropped off from there (hitting the 25ema on the 30min chart as resistance).

US & Asia Overnight from Bloomberg
The global stocks rout intensified with equities in Tokyo sliding the most since August and index futures indicating U.S. stocks will add to declines that sent the Standard & Poor’s 500 Index to a 22-month low. The yen reached its strongest since 2014 and corporate bond risk climbed.

Stock gauges in Japan and Australia slumped and U.S. index futuresslid at least 0.8 percent. Markets from China to South Korea remained closed for Lunar New Year holidays. Evidence of mounting distress in global credit markets boosted government debt, with yields 10-year Japanese bonds tumbling as much as 5 basis points to below zero and Treasuries heading for their best start to a year since 1988. Gold was on track for its longest rally since 2011 as the yen surpassed 115 per dollar. Oil traded at about $30 a barrel.

“Investors had probably thought yesterday we might have hit bottom but they’ve been crushed,” said Nobuyuki Fujimoto, a senior market analyst at SBI Securities Co. in Tokyo.
“Greece, Deutsche Bank, shale gas — all we hear is bad news. Investors must have their heads in their hands right now.”

Traders have unwound bets for the Federal Reserve to raise interest rates this year as concern intensified over China’s capacity to deal with its slowing economy, and the impact of Japan’s imposition of negative interest rates. The distress that has brought global equities to the brink of a bear market in 2016 is flaring in the credit space, with the cost of protecting against company defaults worldwide surging. Deutsche Bank AG shares and debt slumped Monday amid questions over the lender’s ability to pay coupons on its riskiest bonds.

Markets in mainland China, Hong Kong, South Korea, Malaysia, Singapore and Taiwan are closed for the New Year holiday Tuesday.

Stocks
Japan’s Topix index tumbled 5.5 percent in Tokyo, falling the most since Aug. 24 as banks and financial shares led losses. The Nikkei 225 Stock Average dropped 5.4 percent, its biggest decline since June 2013.

“The yen is rising while U.S. Treasury yields are falling and gold prices are rising. Basically it’s showing a risk-averse market sentiment,” Toshihiko Matsuno, chief strategist at SMBC Friend Securities Co. in Tokyo, said by phone. “With increased concerns of a slowdown in inflation in the U.S. as well, market sentiment is being shaken.”

Energy and banking shares led Australia’s S&P/ASX 200 Index down 2.9 percent. The S&P/NZX 50 Index in Wellington lost 1.3 percent in its first day of trading this week.

MSCI’s All-Country World Index fell 0.4 percent, leaving it down 19 percent from a peak reached in May. Most investors regard a 20 percent retreat from a peak as the definition of a bear market.

Futures on the Standard & Poor’s 500 Index declined 0.9 percent with those on the Dow Jones Industrial Average and contracts on the Nasdaq 100 Index.

Equity losses took hold in Europe on Monday, with banks driving the Stoxx Europe 600 Index to its lowest since October 2014. Deutsche Bank tumbled 9.5 percent as analysts at CreditSights Inc. said it may struggle to pay coupons on its riskiest bonds next year should operating results disappoint or the cost of litigation be higher than expected. The lender said it has sufficient capacity this year and next.

While paring declines in the last hour of trading, the S&P 500 still ended Monday down 1.4 percent. The Nasdaq Composite Index neared a bear market as some of the biggest tech stocks dropped, bringing the gauge’s decline from a July record to 18 percent. [Bloomberg]

FTSE Outlook and Prediction

FTSE 100 Prediction

FTSE 100 Prediction

Yesterday started off looking bullish but the picture soon reversed and we got some pretty massive drops globally. No real reason apart from general fear/panic that everything is screwed! It was mentioned that the Vitol CEO’s negative comments played a part but I feel that was the news trying to fit to the price action rather than the cause. With China closed this week for their Lunar New Year it was eyes on Japan overnight, who shed 5%, to scupper the out of hours rise on the FTSE to 5735. Despite all that we know how fickle the market is so I think we might see a bit of a rise today, if the 5660 area holds as initial support. If not then the next support area is 5630 and I have plotted that with the pink arrows on the chart (blue is preferred, pink is plan B). A rise to the pivot at 5747 is what I am thinking, mainly as we are testing various daily channel areas round here as you can see from the levels to watch section below. If we break 5630 however, then I am fully expecting 5400 before too long, especially with oil remaining below $30. So, cautiously optimistic for today!

Older Posts »