6367, 6356,6325,6315 Support, 6412, 6435, 6458 Resistance

Good morning. A decent morning yesterday with the rise to the 6360/65 area before a sharp leg down to 6303, but then in keeping with the volatility, a rise to 6412. Shame it didn’t quite reach the long area at 6291 though. Still, can’t have it all. Markets are still pretty jittery as it looked like the US was going to have another end of day sell off at one point, but it only saw the FTSE get to 6370. Overnight has hovered around that area. Earning that have come through Ok have been pretty good in the US, J&J, Citi etc have beaten revenue estimates so far. The bad news for the bulls is that we are nearly testing the top of the daily Raff channels with resistance at 6408 and 6445 today.

Asia Overnight from Bloomberg
Asian stocks climbed with the dollar and Brent crude oil rose after its biggest drop in three years. Precious metals slumped.

The MSCI Asia Pacific Index (MXAP)climbed 0.3 percent by 12:56 p.m. in Tokyo, with Japan’s Topix index swinging to a 0.5 percent gain as the yen fell a second day. Standard & Poor’s 500 Index futures were little changed. The Bloomberg Dollar Spot Index climbed 0.1 percent as South Korea cut interest rates to support growth and Chinareported the slowest inflation in four years. Gold retreated 0.4 percent. West Texas Intermediate crude traded at $82.03 and Brent rose 0.4 percent after a 4.3 percent tumble yesterday.

The dollar index has gained more than 6 percent since the end of June as signs of recovery in the world’s biggest economy contrast with data signaling weakness in China, Japan and the euro zone. China reported weaker-than-estimated consumer inflation spurring speculation that the government may undertake further targeted measures to support expansion. Oil is languishing in a bear market, with the International Energy Agency predicting the lowest demand growth since 2009, even as U.S. supplies rise.

“The U.S. is in a much better place compared to its peers,” Stan Shamu, a markets strategist in Melbourne at IG Australia, a unit of IG Group Holdings Plc, said by phone. “The dollar, for now, is enjoying a bit of a recovery. Its major peers — the yen, the pound and the euro — are likely to remain weak.”

Eight out of 10 industry groups in the Asia-Pacific share gauge advanced today. Chinese stocks rallied as the country’s one-year interest-rate swaps dropped to a two-year low a day after the central bank cut the rate on 14-day repurchase agreements for the second time in a month.

Easing Room
The Hang Seng China Enterprises Index climbed 0.8 percent in Hong Kong, where the Hang Seng Index increased 0.7 percent. The Shanghai Composite Index (SHCOMP) rose 0.4 percent and a 2.6 percent surge in a measure of health-care stocks pushed the CSI 300 Index to a 0.6 percent gain.

“The low inflation lays the foundation for further targeted measures to support growth,” said Huang Hai, the Beijing-based deputy head of the research department at SDIC CGOG Futures Co., a unit of State Development & Investment Corp. “Concerns over growth momentum persist, and that can explain why the PBOC cut the rate in repo operations again.”

China’s top economic planning agency is said to have suspended approvals this week for the sale of corporate bonds, deepening a crackdown on corruption and irregularities in the bond market.

FTSE Outlook

FTSE 100 Prediction
FTSE 100 Prediction

We hit the top of the 10 day raff at 6412 yesterday before dropping back, so that level is the first main resistance, though the top of the Raffs are now at 6408 for the 10 day (descending channel so its lower than yesterday) and the 20 day at 6441, however the 20 day Bianca is 6435 and the 10 day Bianca 6458. Basically there is significant daily resistance between 6430 and 6455! I have put in an initial rise on my prediction to that PRT line on the 30min chart at 6395ish, though looking at the 10min chart there is a fairly decent rising channel with resistance at the 6425 area. As per usual when its volatile it makes my job harder! Anyway, presuming it does find resistance on the 30min, I can see a dip to support at 6356, though if that breaks 6325 and 6316 are the supports below. I think 6356 will help for a push up from there, probably to the top of the various daily channels. The main stream media has been getting bearish with various doom and gloom headlines (though not as many as one would like to really flag up the lows being in) so we might see a bit of a bounce. So, I’m still bullish for the moment up to the daily channels really around 6430/50.

142 Comments

  2. Morning All,
    RC – Fine targets as per usual.
    Aye Sam – 6298 as RC’s lower target but also there’s the +/- 3 margin of error !

    Work commitments making posting regularly difficult
    Have a good day all..

      1. maybe, but any bounce at pre-open is 99,99% negated after FTSE opens.
        I can count the fingers on my hand, when FTSE follow at open any pre-bounce from overnight

  6. FTSE/5 mins — I had a SHORT in place from 6399/23:45 yesterday and this held until a LONG from 6314/09:50 this morning. I have attempted to excise out of hours trades and am waiting for a reply from IG in that connection. Otherwise so far so good.

  7. OMG, I mixed up these flipping prices. I was looking on yesterday’s Nick’s chart and thought it was today’s. Actually it was spot on. Today’s arrows, if anybody tried, would be costly for somebody.

  9. hmm bit of a tipping point for today this 30 level on the FTSE, personally it might have a bit more upside so I’ll stick with my long @07 for now but if we get back to 6400 levels tempted to short again as there might very well be a bounce but with Ebola, Russia (yes they back, they just stopped banging the drums cause of their beloved F1 coming to town), deflation etc.

  10. Jim
    Are you using Probacktest ? If so, the manual saids it uses all hours available, no exceptions.

  12. Also I´m having difficulty to set hours from 8:00 till 16:30 on UK and DAX and 14:30 till 21:00 in US.
    In the past I successful change the hours in the prorealtime.
    THis time it won´t change
    Anyone experience the same problem ?

    1. PMS – See if this helps..
      You need to set the time..
      as follows:
      ** I hope this enters properly as HTML can mess with it..
      After it says conditions to enter long Positions
      Indicator 2 = ABC[19](Close)
      c1 = (indicator1 070000 AND TIME <170000

    1. Afraid you are wrong because the reason oil is down is because manufacturing demand is going down, fast. The price of oil is demand driven not the other way around. They only other contributing factor is there is more supply due to shale exploration but this is not super significant also because its not infinite.

      1. me neither, but it would be good for US sell in the open and after mid session stay strong till closed,

  15. Jim, when your system gives a bad performance from one single trade, try to optimize later. Tell me your results after

  18. PMS,
    At the moment I’m using the 5 min. timeframe and a run of data from Monday morning. With this setup the parameters are stable and I can hardly fault any of the trades! But yes I think recalculation is a good idea in the event of a dud signal. Making available to the model a longer run of data might eliminate the problem also. The trading hours issue seems unclear!

  28. Jim, when you change the amount of data in the top left corner, for ex., 3 days only in 1 hour chart, it means the data is only from the last 3 days. Right ?
    So why I see candles since August 5th ?
    I never understood well what that box means.
    If you place 10000 bars the amount of data showed is much more than a 100 bars, and the chart looks right…it’s only when I use the days, weeks, etc that something is different

    1. me to. that was a mistake. what stop have you got? or are you already closed?
      I was going to 6215

    1. you have to ask yourself on what basis will it rally? The only reason left now is if the market things earnings and Q4 guidance is going to be good but after these US numbers I doubt anyone will…

        1. I saw that for 1st time. DOW reached 15945 and the spreadbet only 16044. What ????????????????????

        2. libbo2003
          they can do that ???? They make their own price ? They said they follow the futures. And futures were much lower than the spreadbet

          1. i think the spread betters were not out the futures was in line with them just the cash price sunk for some reason

  31. My system on DOW never changed the variables, even after a reverse from buy to sell yesterday, with 80 points loss. And still with huge profit.
    FTSE changed very dramatically, because it saw the mistake and tried to find best option.
    What I’m still trying to understand is the amount of data that Probacktest reads.
    I have the top left corner has one of the variables, but also in the Probacktest I have the option to change the amount of data I want it to read.
    Jim, if you do not synchronize those 2 variables, the result could be bogus. Right ?
    How you handle that ? You can not know how many days a 100 bars chart is and vice versa.

    1. Jim, when you have the time, I would like you to comment on that.
      Thanks

      Note : Any change on the variables after a loss is something that places red flag in the system. FTSE gave me that. Won’t you agree ?

  32. Hi Guys
    There has been no Long signals , But I have something which I wil explain later

    1. There are 2 Flashing Buys. ( tentative )
      If this 6268 Holds as resistence and the market goes down
      6225 & 6194 Could be a buy.
      BUT only if it gets there.
      To avoid a Fail. – Keep the stops TIGHT.
      No Targets For this.

  34. It depends on the spread betting platform you use. I used to use Plus 500. They were 25 points lower but it moved with the market and you still trade exactly the same.

  35. PMS —
    My understanding is that:
    1. You can view whatever data are available, or less, in the usual chart screen.
    2. The range of data viewed on this screen has no bearing on the execution of the backtest. However, the backtest uses the data frequency selected on the active chart screen.
    3. The span of data used by the backtest to optimise parameters is specified by the Starting date and Ending date fields on the Trading system creation screen
    Hope this helps. 🙂

    1. So, if I understood. The Probacktest dismisses what data is in the actual chart. It has an inside view of the data you want in the start and end fields.
      And also after the execution of the backtest, if you change the frequency data selected on the active chart screen (100000 bars to 100 bars), the backtest will change accordingly. Is this what you mean ?

      Jim

      Thanks for you insight.

      Also I waas wondering that thing with frequency data selected on the active chart screen: if you have 3 days, why the chart shows candles since August 5 in 1 hour chart ?

      1. PMS — Yes that’s right. Re the last question, ProRealTime seems to hold different amounts of data for different data periods, for any given instrument.

  36. RC —
    Had a sell in place from last night, which did well from 07:00 this morning. So, buy 6314/09.50; sell 6321/12.20; buy 6267/14.55. I don’t expect the last buy to last for long.

    1. Jim

      Good signals. So each signal if taken would have yielded a positive result.
      To be honest – your drawdown is not bad at all. I guess within normal stop parameters.
      I missed my first signal – at 8.00. Just moved off the starting post and had no time to get my trade in.
      I am going to change a few parameters again. This wont help 8.00 am trades but will try and see if I can get a second chance at the trade.
      At present I have 2 buy signals at 6225 & 6194 – But I really dont know about it as the sell signal is still active. I have only seen this once before – so I am hesitating.

  37. I’d like a proper run up now please.. Long DAX 8578 and if I don’t make 50 points or more on this trade I might as well give up..

  38. Guys
    To anybody who has taken the 6225 trade – keep very tight Stop.
    But if it does cross 6245 & remains higher – move your stop to B/E
    or a few points below 6245 – Potentially a good mover.
    Good luck

  39. RC, as usual, your software is spot on Long @25. It did bounce off 25 but bounce isn’t convincing.

  40. out DAX @ 40, nice 65 points and out of FTSE at 47 but if it hangs around here I might be tempted to go long FTSE again around 45 level

  45. Taken this Long at 6198 – out of frustration really.
    Missed the trade down this morning.

    1. Sam
      This is just me letting offf steam.
      Frustrated at missing the signal from morning.
      No Targets – Just placed a Stop 10 points away.
      I dont usually take after hour trades – very suspect.
      But I suppose – a target could be 6345 then 68 ( not software generated )

  47. Lucky you sam, I’ve closed out my longs DAX yesterday with a loss of -15k odd, recuperated 3k of which on the DOW last few days. Should have stuck with day trading as I’m pro bear, but I don’t intend to go short anymore as scraping the barrel a bit…
    Might go long on the ftse as analysts predict a strong year and even though unemployment figures were at its lowest market went down, just shows market is just playing towards sentiment. At this rate 8000 on the DAX looks viable, but I’ll scalp after 5:00(too busy) and evaluate a BETTER long long term position.

    Gl all, what a crazy market!!

  48. PS I do aggregate trades and to put it into perspective I ended up closing a DAX 1 point for a loss of -£432.

  49. Every forum I been on today are on disbelieve many trader blown there accounts… One guy 59k down in 3 years!

  50. I think I said here, the markets will go up, when everyone will be out.
    And my premonition months ago, for the October was damn right…but I failed to back it up with positions in all indices.
    Also the bull***system which I’m very frustrated with bogus signals on FTSE last Monday, put me also in sidelines.
    I’m still figured out what it’s doing. The manual does not say anything more…is very limited in info…but DOW, SPX and DAX are in absolute huge profit, since OCT.1 and yesterday I had new sell signals from SPX and DOW after a small bounce and did not take it, because of the bogus signals on FTSE. Damn

  51. Smoking last time this sort of thing happened in 2012,people can’t adjust to it, heck who is to say it won’t drop another 1000 points? buy the dip just got hammered, indecisive market always spells trouble. Been looking at IG stats the number of people long just keeps staying high therefore likely to more downside…

    1. 15k loss…. :D, you need to stick to do other things than this.
      Like giving some money to others, instead of giving it to the market.
      Get another hobby, this one is too frustrated

  53. Ahwab this what happens when central banks give 0% interest rates saver take risk and it’s always the retail invest that gets slaughtered…. Sometimes it’s just best too work be happy and forget about chasing £££££ happiness is a state of mind society tells us all we need all the materal things in life…

  54. Jim, that thing with data frequency, i just found out that if you change it, the variables will change also after a probacktest

    1. That’s right PMS; you get a new model for the new data frequency. But sometimes the model disappears when you do that and you have to go into the editing screen to rerun!

  56. PMS no risk no gain, what I lost there was what I gained on the way down from DAX 10k, just a matter of finishing this year well. No doubt many people on this forum lost out but not prepared to divulge.

    1. Fear, fear about economic outlook. I was expecting volatility this month but not untill fed meeting at end of this month, but this carenage today wasn’t expected.

    1. I realise tht you (and others) can do with a relief rally but I would not bet the house on it. As I write this the Dow recovered some 100-150 points from today’s low but I see no reason why it can sustain this. Unless all companies reporting after the bell have amazing mind boggling numbers. the fear is there and Putin, Ebola, EU incompetency, Deflation etc. are just going to set the tone, all sentiment. short the rallies tomorrow, same as I said this morning

  61. Jim
    But If you change the data frequency for ex: for 1 week and place the start probacktest at Oct.1, I cannot figure out what reads it will made.

    Is the 1 week data movement prices or from the Oct.1 ?

    1. I made the test and it gives different results, with same start OCT.1 and different data frequencies. It’s a puzzle to me what in fact it’s doing. Reading the data since Oct.1 and also the data from 10000 bars and crossing that info ?

    2. Evening chaps,,
      PMS – It will show the dates in the detailed report and also you can refer to the trades “Closed positions List”.
      Also if you click on the spanner you can modofy the back test and set the date that you want it to start.
      You might find you need to download data for the period your looking for – so make sure you enter – 10000 units or something like that.

      1. Hi Hugh

        That’s what I’m asking. What data it reads ?
        I place the start at Oct.1 on the Probacktest and 10000 units in the chart.
        So what will probacktest reads for the best average price ? will it cross data from the prices starting Oct.1 with the prices from 10000 bars(which includes prices far beyond Oct.1)

          1. What you mean by closed positions list ? the detail report ?
            It saids the starting and ending date for the detailed report performance.

            I placed a Probacktest
            start date Oct.1 8:00am
            and end date real time

            And data frequency 10000 bars

            What will probactest reads ? The data for only the period starting Oct.1 or crossing with data for the 10000 bars ?

  62. Jim
    when you say :
    At the moment I’m using the 5 min. timeframe and a run of data from Monday morning.

    You place the start date at Oct.13 and data frequency from 3 days or data frequency randomly (100 bars/10000 bars )?

  66. Unlucky senu :/, people were just cashing in :). Personally this time yesterday when DOW was up 70 odd points after hours shorted and I managed to get most of that 500 pip swing albeit with minor £ per point. Though in hindsight…

  68. Hi All hope you are all ok
    what can i say broke every rule in my book and lost £10k
    live to fight another day

        1. the same here. all the indicators are pointing to the sell. don’t know why i ignored it. I think it’s fear (1st oops). and then greed when I was losing (2nd oops).
          I have no idea why I was staying put and managed to wait till recovery. I think because I was not at the screen after 16.30
          That was like a torture but in some way was a positive thing as I didn’t close when it was down. But it’s also a negative, I could have lost more and more. it was out of control.

    1. Personally – it is looking like our market is not going to respect
      this buy signal at 6229. But it is still present – so lets hope!

  71. Sorry to hear nelly but it happens, the losses are just always a bit greater than the gains, it least so it feels. Crawl it back bit by bit and these markets are very good for scalping on low per point stakes, made £250 for 3 trades just shorting each up tick for 10-15 points. Gl

  72. Well, I survived the second flash crash, now I am unbeatable. Just closed for -110 points of double stake (-55 actual points) but not -622 points of double stake (-311 actual points). Lost 330 pounds, but not 1885 pounds. Madness complete. I don’t know why I get so stupid sometimes. I could get 100 pounds now and then but didn’t, instead I ran into loss.
    I was running a minus margin, don’t know how they didn’t close me. I had 2150 pounds in account and the loss was -1870. Not sure why they didn’t close me. But it did recover. I didn’t know anything until 5am. the last time yesterday I’ve seen it was up 150 points.

      1. I’ll get back there. I won 430 pounds in the last couple of days only. So hopefully after a brain wash I will fight another day, maybe not today.

  73. Good for you jack but do yourself a favour and lower the stakes more and more as you get more profitable. Seems counter intuitive but trust me in these markets is sooo easy to get it wrong as it’s pretty much a gamble show driven by sentiment. Then when markets calm down and you are still up then go bigger again and trade on ideas. Gl

    1. agree with you 100%, intuition helps sometimes but not always. by the way, that was a decision today to lower stake by 1/3, 1/2 until I reach a certain amount (the one I lost now). It’s like 150-200 points of slow winning. I didn’t lose the whole deposit, that’s a good start.

    1. Hugh
      Cant open it – Mind sending it by email.

      I Dont have a clue about 6229. It went through it – But now above. So not sure – only thing that i can think is that because of the nature of the market as it is – it just needed that extra push !! ?? I dont know. But its back above 6229. So I dont want to give up on the system just yet.

  75. 6282 – 6208
    Fibs – 50% 6245 – 61% =6254
    6256 Would be a good line to gauge market sentiment.

  78. Hugh try out ? Your images do not upload
    Did you read my posts and my question?
    Can you answer that question ?
    It’s a simple question

    Thanks

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