Prediction | Support 6618, 6610, 6601, 6592, 6568, 6548, 6505 Resistance 6650, 6670, 6691, 6728, 6801

Good morning. If you wanted to take a day off to enjoy the warm weather today is a good day to do it. The US is closed for Independence Day and we are going into what could be a lively weekend with a possible Greek referendum, that at the moment is too close to call one way or the other. So much so that IG and other workers have increased their margin requirements substantially for the expected increase in volatility. Would be a good weaken to not hold any position over unless you fancy the risk.

Greece (from Bloomberg)
“People will just wait and see what happens after the referendum,” said Benedict Goette, founder of asset-management firm Compass Capital AG in Zurich. “The dynamics are still difficult for the market. There’s another turn every other day, a new rumor, a new leaked document.”

A measure of expected stock volatility was near a three-year high reached this week. A survey showed more Greeks are going against the government’s call to vote against creditors’ demands. The nation is now living with capital controls and has shut banks and its stock market after its euro-area financial-aid package expired and it missed a payment to the International Monetary Fund. Further bailout negotiations would have to wait until after the referendum.

U.S. Jobs
European equities first remained little changed after the U.S. payrolls report showed employers added 223,000 jobs and the unemployment rate fell to a seven-year low of 5.3 percent. Then, as the dollar weakened against the euro, the Stoxx 600 drifted lower. [Ref]

US & Asia Overnight from Bloomberg
Asian stocks fluctuated, with the regional benchmark gauge set for a weekly decline, as investors awaited Greece’s referendum and weighed U.S. jobs data.

The MSCI Asia Pacific Index added 0.1 percent to 147.08 as of 9:20 a.m. in Tokyo after falling as much as 0.1 percent. The measure is headed for a 0.5 percent decline this week. The monthly U.S labor report indicated job creation advanced in June while pay stagnated and the size of the workforce receded. The Standard & Poor’s 500 Index ended the shortened week down 1.2 percent, the biggest weekly loss since March, after closing little changed Thursday.

“I don’t think the U.S. labor market is getting worse, but it’s not getting better either,” said Nobuhiko Kuramochi, head of investment information at Mizuho Securities Co. “It’s not a reason for the Federal Reserve to hurry into raising interest rates. Polls on the Greek vote show that the results are in the balance. It’s difficult for investors to move.”

Markets across Asia will on Monday be the first to react to the result of Greece’s vote. Prime Minister Alexis Tsipras is calling for a rejection of creditors’ demands, and polls suggest it’s too close to call. Finance Minister Yanis Varoufakis said he’ll quit if voters back austerity.

Two days after Greece missed a payment to the International Monetary Fund, the Washington-based global lender of last resort said the country needs at least a further 36 billion euros ($39.9 billion) from the euro region over the next three years and easier terms to make the debt sustainable.

Jobs Report
U.S. employers added 223,000 jobs in June following a 254,000 increase in the previous month that was less than previously estimated, Labor Department figures showed Thursday. The jobless rate fell to a seven-year low of 5.3 percent as more people left the labor force.

Earnings at private employers held at $24.95 an hour in June on average and rose 2 percent over the past 12 months, matching the mean since the current expansion began six years ago. Wages had increased 2.3 percent in the year ended in May. The participation rate, which indicates the share of working-age people in the labor force, decreased to 62.6 percent, the lowest level since October 1977.

Japan’s Topix index gained 0.1 percent. Australia’s S&P/ASX 200 Index slipped 0.5 percent and New Zealand’s NZX 50 Index added 0.2 percent. South Korea’s Kospi index fell 0.1 percent.

Futures on the Hang Seng Index slipped 0.1 percent and contracts on the Hang Seng China Enterprises Index declined 0.3 percent in most recent trading. Contracts on the FTSE China A50 Index lost 0.7 percent in Singapore, indicating another day of losses in a stock market poised to be the world’s worst performer this week. [Ref]

FTSE Outlook

FTSE 100 Prediction
FTSE 100 Prediction

Its a hard one to call today but I have gone for an initial rise to 6650 where we have the top of the 10 day Raff and the first of the fib resistance lines, as well as yesterday high. A dip back towards the pivot at 6618 and possibly even the bottom of that rising 30min channel slightly lower at 6605 before another rise. I am not sure we will see 6728 but if we do then that will be a good shorting area as we have the top of the 10 day Bianca and also the 25ema on daily there. At the moment the polls show the referendum split down the middle so a tough one to call, but then we all know what polls are like! FTSE is cautiously bullish first thing for me again, but will need to see what it does at 6650. A break below that 30min channel will then lead to next support at 6592 then 6548. Might be worth a brave long here as we also have S2 at this level. Pretty much all of today is going to be focussed on the Eurozone and Greece and what may or may not happen. The 30min channel looks a good one to use for trades initially.

70 Comments

  2. Just chiming in been scalping this morning ….range 12 – 32 …. 7 trades so far,position size biased larger by 3 for the long side exceeded my daily target by 50% not massive profits but little and often good luck everyone

    1. Yes, a good Risk/Reward strategy on a day that is pretty nailed on to be range bound.
      I’m off for a long weekend, with not a mention of FTSE or pips till Monday.

      🙂

      1. Careful noitall sooner or later you are going to get bitten,don’t get over confident

  5. jim

    i work in the back office of a hedge co. during nights reconciling
    firm is trialing a black box ( well it is a software programme ) on the market
    they have asked me to run ( trial ) night markets – so i take trades for the co
    as well as do my work. i place orders as per BB & exit the only manual
    condition is my stop has to be £500 on Ftse – so presently trading 25£ /pip
    with 20 stop
    the software owner is from uk and while talking to him he gave this site name
    for free ftse talk as he used to log into it
    but this software really does kick out fantastic trades

    4. LOL, sound like Syed is testing his new software based on some mysterious Black Box.

  7. jim

    no it did not
    the trades as per bb was – long 6602 – soon after exiting short at 6606
    exit that trade at 6620
    the next trade was 6619 short exit 6598 – still in it

      1. Hi All – Taking it easy these last couple of days.
        But actually done two trades today L 6604 & S 6620 except came out of both too early.

        Just treid another L at 6598 – but got fed up with waiting out b/e.

        Noit all what’s your target on 6619 Short.

        1. Would seem logical that it’s so sticky here that perhaps it wants to try for 6573…..

  9. jim

    what do you use
    i was told people use graphs to trade
    our firm use fundamental research and algo trading
    this is first time a specific signal trading is being used
    our principal traders are just blown away by it
    they want to automate it but software owner is not
    allowing access to code ( i can understand this )

    1. noitall — Right now I’m looking at the Heikin-Ashi open, close, high and low. (Hugh mentioned HA here the other day.) I’ve coded the variables and written a few filters for ProRealTime which I use. It’s early days — but quite promising.

  12. If the greeks say yes, everything should shoot up, (emphasis on should)?
    But if they say no, and they’re out should it be another panic sell?

    1. what exactly is “buster activity”, never heard the term! is it literally bust out all the longs

      1. Expectations Greeks will accept offer. They are making markets drop to buy in at a cheaper price and profit from big rise. At some stage the buyers will outnumber sellers and the price will start to move up

        1. sorry all I am reading is its split down the middle. If they wrong markets will collapse

        2. thanks argyle, i’m kicking myself for not having full faith. I sold dax at a £16 loss and the ftse at a £3 loss when I could made £16 on the dax and broke even on the ftse

        3. Argyle sorry carry on, are you referring to this session only, i.e. making money on the rebound in this session or a buy and hold over the weekend.
          If the latter it makes some sense in that they can buy and hold for a long period and ride the waves.

      2. Milka – Think Argyle is referring to the fact that this move will probably have taken out alot of Long positions as Support levels have been taken out.

      1. Hangin’ in there by the skin of my teeth …hoping that this is the retracement before a proper bounce ..!

  18. Well never got around to placing that trade as got pulled into something at work. Happy weekend everyone!

  20. Evening all, had a lovely break in the country and, just as I pulled up outside the house, heard the exit polls.

    Highly complex bear trap this, apparently involving ~60% of the Greek electorate….

    Sunday IG 6470 atm, I’m sure the bulls will be stocking up at these bargain prices, those that aren’t already margined up to the eyeballs, anyway.
    Oh for a couple of billion behind me, I’d sell everything so hard on Monday there’d be queues at the skyscraper windows.

    1. “Highly complex bear trap this”
      “Oh for a couple of billion behind me, I’d sell everything so hard on Monday there’d be queues at the skyscraper windows.”

      TMPF, what are you getting at, are you saying you think this is a bear trap and you would sell everything to get into the market. Or are you being sarcastic, and expect the market to drop further, and you would be selling the market as much as possible?

    2. btw Where did you go? Good to hear you had a nice break in the country especially in this weather, bit like the tropics.

      1. Mainly sark milka. It’s sop for bulls to shout “bear trap” on the way down and after 6 years of being right, who can blame them?
        They have to be wrong sooner or later though, why not now?
        Somerset, my favourite county.

  21. Well looks like a no vote, and the FTSE down to 6479 on the Sunday indicies on IG. Anyone reckon more downside on open tomorrrow morning? Or a trot back up to the 6600 mark?

  23. i sold FTSE this morning at 6605 on IG Sunday trading. Stop at b/e. Let’s see what happens. Bears carry on mauling or angry Bulls come out with full force when cash markets open. I wonder how far Chinese measures fare in containing bears in their markets. Bears all over !!!

  24. I don’t know chaps 🙂
    I made my thoughts clear a week ago that a sudden attack on the recent lows 6100/6300 was possible and I stand by that.
    I think a large aggressive short selling program by a big player could crack the FTSE and the DAX into a margined out meltdown. Tomorrow could be the day.
    On the other hand, a support operation would cost a few day’s QE and keep the band waggon rolling.
    Has anybody thought that parity $/E might suit the Germans very well? If they can achieve that by ditching a basket case, so much the better.
    And IF this coincides with another twist in the current Chinese saga tonight, the coming week might go down in history.
    Whatever happens, the fact is that global equity values are only where they are because of massive Central Bank support. That’s going to come home to roost sooner or later.

    1. I think the no vote just leaves even more unanswerable questions and further pushes the Greek situation in to uncharted territory. More uncertainty just means more fear. TIMBER all the way it is.

      1. Not so sure. There will be massive central bank action to ensure rises as per last Monday. This will probably continue till negotiations concur. They will keep prices higher than they would be. Can see Dax back to 11000 tomorrow. FTSE 6550

          1. I would urge caution on placing shorts. Too much support now. Only 1 way this will go.

          2. Agree with you Argyle. I too think we’re low enough for a bounce. Market conditions at the end of last week suggested gap down and that happened. Tomorrow could be a buy day until U.S. open just like last week. Should have a clearer picture by 7 am tomorrow

          1. Overnightprices don’t look very strong. I am now inclining towards shorts but will need to watch a bit more before coming to a conclusion

  25. Tmpf, at 22.50 my position was liquidated in the sense IG topped up my account with the profit. My position was ‘reset’ to Friday closing value with big -ve. At 23.10 when futures market opened my position was in green as futures opened lower than Sunday FTSE closing price. I have immediately closed my position, in total made about 1k. Lucky me!

  26. do cash markets open at 6am/7am. I always see big jumps either way, but can’t find anything that says a pre-market or something open at this time

  27. TMPF what happened to that £7k you lost last week on your other account (ftse sell). Did you hold the positions?

    1. I was short at 6620 and closed it at break even. I ‘lost’ £7k in paper profits by not talking them. Looking at a big short this morning too.

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