41 point dividend today for the FTSE 100. North Korea tensions escalate again

9th August 2017

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Slow drift up yesterday and it felt like the prospect of the 41 point dividend was the only thing underpinning the rise. It certainly came to a halt as Donald Trump ratcheted up the rhetoric about North Korea as tensions escalated yesterday afternoon. That rattled markets at the time, saw gold rise having dipped as low as 1252 prior to that, and the reverberations carry though Asian markets today.

All things considered I imagine that a war in the region will be avoided at all costs as if it starts where will it end. With stock markets in Asia and the US at record highs it was a good excuse to bank some profits too, and the S&P500 hit the top of the 10 day channel yesterday at 2490 as well.

Today’s main news for the FTSE 100 is of course the 41 point dividend and bear this in mind for later as it will effect open positions (on daily cash). Some info here on how it effects positions. We may well see the divi hunters start to appear around 15:00 this afternoon and pull prices up – this divi is one of the largest ones. We might even mange to hit the 7580 level today if its really chased and can shake off the NK tensions.


FTSE 100 Outlook and Prediction

Daily FTSE 100 Support Resistance Channels
Daily FTSE 100 Support Resistance Channels

After the relative calm of Monday and Tuesday we might well see a bit more volatility today, mainly driven by North Korea tensions and the 41 point dividend. The 7550 area remains as initial resistance with 7580 above that. I don’t see it getting too much past the 7580 level today, especially as we have the top of the 20 day Raff at 7585.

We have support initially at the 7503 area with 7490 below that. If that should break then there is a decent fib support at 7472 and S2 at 7475 – though with the 7500 level holding overnight I can see us being slightly bullish today.

The dividend is applied by different platforms at different times – some at 16:30 some at 9pm so just bear it in mind as it will apply to any open daily cash bets that you have open.

If the bulls were to push past the 7600 level then we are looking at a rise towards 7680, however, if the bears do appear at 7600 or just below again, then we could be on for a steady decline over the next few weeks.

For today then, cautiously long to target 7550 and 7580 areas, and watching 7490 and 7470 as support areas.

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57 Comments

  1. Morning all. Holding shorts.
    Quick question re the divi today. What is the latest time i can add longs to qualify for a divi? Is it 16:29?

    1. Depends who your broker is……some are just before 4.30 and others you can leave it till just before the spread changes last thing in the evening….

    1. I’m long here from 7480, purely looking for a dividend rally. Not sure it’s going to hold up when the US opens. Stop is at 7470

      1. Oversold on the hourly and possible double bottom formation in the 7470s is the buy set up, but want to exit if that doesn’t hold hence the stop at 7470. Bigger picture it looks like a bigger move down is underway though so this is a short term play

        1. I’m expecting some gains in the dollar index that should weaken cable and along with the dividend I think it will edge up again….it’s probably taken a lot of stops out on people holding longs yday and reduced the amount of long positions….people more cautious now and it will probably head back toward 7600….. Just my opinion,and how I’m thinking….

          2. Yeah I think this dollar move has a bit further to run. But it looks like it’s in the context of risk off. Dow and S&P have posted clear reversal candlesticks yesterday so it looks like US markets are going to correct, if that happens then I’m not sure that dollar strength is going to make the FTSE go up this time, probably just soften the downside

    2. It’s always a hard one.. it’s a pain tbh as it’s a distraction. You’d expect some sort of rally to come at some point with a divi that size, but could have said that yesterday and it’s since dropped 50 points and unlikely to get back up there on a rally. Hence why you can’t just blind buy it, there has to be a set up. As long as it remains above 7475 a rally looks on but below there it could fall some more and then just bounce

      1. yeah u r right !! that’s why only got only 1 long from 80…hope it does running out of patience.. dun want to on other side when it rally

              2. I’m also long @84, but plan to get get out before 16.30 as I can see a big drop this evening so don’t want to hold after the div drops it 40pts, just my thoughts 🙂

  6. FTSE long, 503, 80.

    I don’t think this is a correction phase just a platform to go higher (Dow and us markets)

    1. I’ve taken half off at 7503.. it’s a weak market and hard to tell what’s priced in and what isn’t

    1. you might be right as well. but as long 372 doesn’t go on daily we are still in uptrend . also it seems highly unlikely that we would drop like this after touching 7540 yesterday. depending where daily candle closes today we would either continue or stay wintin 400-500. got divi awaiting it to go 80 and all 41 pips in the bag.. c ya guys tomorrow

  12. If nobody is buying now for the 40pt div, its hard to see who’s going to buy it, this could collapse after hrs

  13. My thinking is the massive div has drove the market since last Friday and stopped out a lot of stops this week and now it drops, it will be interesting to see if it can close the div gap tomorrow, if not I think we could see 7200 before 7600, the US put in a reversal candle on the daily yesterday, so there’s a fair chance we see a drop there, I think we will see some negative news coming out in order for the markets to drop, again I’m no expert and I’m not that interested in the longer time frame anyway, its just my thoughts.

    1. Most think it will drop after the divi….what better time to rally hard….Dax down about 800 pts from its high dow could increase positive sentiment with another 100 and a nice drop in cable……..where’s this 7600 :0)

      1. Anstel.. no market is too high to keep buying or too low to keep selling.. the main thing I can see across all of the charts this week is the ugly reversal in all of the US indices yesterday. If a market goes higher then closes lower that’s usually a warning sign for longs. I don’t think the North Korea thing will come to much but it’s an uncertainty that’s not going away quickly and now earnings season is done there’s a bit of a void of positive catalysts for the next few weeks so it’s ripe for some profit taking. Didn’t get my 7100-7200 first time around because of how good earnings came through but the technical structure is still the same unless we make new highs

        1. Thanks Mcg……I’m not really a chartist but I take your point….good luck……I think most of the news is a distraction TBH…

      2. Hi all from Shanghai. Hope you are all doing well. anstel I hope your 7600 comes good…:) And you all so well on the Divi today…

  15. The WiFi in the hotel keeps dropping off. Emails are problematic…but I thought you might be on here for a little conversation. It is 1am here now and I have not yet adjusted to Chinese time 🙂

    1. Hi Tufty :0) lol any excuse….I’m usually not far away…..doin ok so far sat here with another stunning blonde who’s keeping gromit company :0) Lets stick to emails hey ,don’t want to upset Nick….and keep your position size small while your out there.any problems hedge it for safety…have a great time. Love it :0) international trading…stay safe ….. Holding long bias but on it 120%… hedge reduced 33%. Party On :0)…..

        1. Thing is Icarus these women are really good traders …..they take less risk on…… Over time that 1% compounded interest really adds up ……..credit where it’s due…

      2. Lady T is doing great and giving me the……have you got any food look..:0) she says go long on smackos as she has a low resistance level :0). Will check emails later…Thanks Nick….

            1. Thing with hedges used for safety or to escape dividend liability is they need to have very careful monitoring so one side doesn’t get too far away from you …the last thing you want is to get stuck holding a large hedged position in the opposing direction to your market viewpoint…….”The first cut is the cheapest” if it goes wrong……

  17. Hi Icarus… night CE to hear from you 🙂 it is 06:45 here…just a summer holiday although the your holiday is pretty intense so more of an adventure than a rest! Another busy day planned. Hope you have a good one today…catch you all later 🙂

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