6500 support, 6555 and 6573 resistance

Good morning. Most of the news over the weekend continued about Russia and the continued “aggression” or land grabs (as well as the ongoing hunt for MH370 still. Chinese manufacturing PMI out last night showed the third month of contraction, coming in at 48.1. However, that has fuelled Chinese stimulus talk so markets have shrugged it off so far.

Asia Overnight from Bloomberg
Asian shares rose, with the regional index rebounding from its biggest two-week decline since June, and the yen fell against major peers. Copper erased last week’s gain as a preliminary Chinese manufacturing gauge unexpectedly fell, while gold and silver retreated.

The MSCI Asia Pacific Index added 0.8 percent by 2:25 p.m. in Tokyo as a measure of Chinese companies in Hong Kong (HSCEI) increased a second day after entering a bear market last week. Standard & Poor’s 500 Index futures were little changed. The yen dropped 0.2 percent to the dollar. Copper slid 0.4 percent after capping its first weekly advance since Feb. 21. Gold fell for the fifth time in six days and silver retreated 0.5 percent. Corn futures gained 0.6 percent.

A preliminary purchasing managers’ index from HSBC Holdings Plc and Markit Economics signaled a third month of contraction as China’s leaders work to accelerate already-decided growth initiatives. France, Germany, the euro zone and the U.S. also publish early indicators for March manufacturing today. U.S. President Barack Obama arrives in Europe today as Russia, which completed its annexation of Crimea last week, masses soldiers on the border with Ukraine.

“The worse the PMI data is, the bigger the chance of stimulus, so perhaps people are looking at it that way,” said Dariusz Kowalczyk, a Credit Agricole CIB strategist in Hong Kong. “The key thing is that the government started talking about stimulus, because had they not begun floating that idea, the reaction would clearly be negative. Because we have a statement of policy intent to protect the bottom line, the negative data would probably only strengthen the resolve of those in government who want to spend more money and limit losses.”

Stocks Rally
The Chinese manufacturing gauge was at 48.1, from a final reading of 48.5 in February and below the 48.7 medianestimate of 22 economists surveyed by Bloomberg. About two stocks rose for each that fell on the Asia-Pacific equity measure, with all 10 industry groups advancing.

Broad Weakness
The CSI 300 Index (SHSZ300) of stocks in Shanghai and Shenzhen increased 1.1 percent after jumping 3.4 percent on Friday, the most since September, amid speculation that China would allow some companies to use preferred shares to raise funds.

“Weakness is broadly-based with domestic demand softening further,” Qu Hongbin, Hong Kong-based chief China economist at HSBC, said in a statement. “We expect Beijing to launch a series of policy measures to stabilize growth.”

China issued rules after markets closed March 21 for a trial program allowing companies to sell preferred stock, expanding financing options for the country’s banks as they seek to address tougher capital requirements. Companies will be able to issue the shares if they are included in the Shanghai Stock Exchange 50 A-Share Index, the China Securities Regulatory Commission said in a statement on its official microblog.

FTSE 100 Prediction
FTSE 100 Prediction

FTSE Outlook
The past few sessions, today included have been quite hard to call, though Friday worked out alright in the end. The key level today is 6537, pretty much where we are as I type this. If this fails to hold as support then 6503 is likely (and maybe worth a long as we have had some decent bounces lately from around here. As its quite volatile it pays to keep the stops fairly tight though. On the bullish side, if 6537 were to hold then we have the daily pivot at 6555 and resistance on the daily chart at 6573 -so both levels worthy of a small short. As per usual, on trades I will aim to get stops to break-even and trail the stops. Generally I feel its held up alright even with that worse than expected Chinese PMI, so we may yet see 6600 again soon. Certainly looking at the Raff channels for the Dax and S&P the 10 day channels are pretty bullish!

206 Comments

  1. Looks like everything is going to plan
    my longs are still working at 6500 6520
    6540 & 6560
    There may be one last dip to 6510 – and
    this will provide the only oppurtunity to
    buy at 6500 area. then we will go to
    my targets by april. i will continue to buy
    at 20 pip intervals and should have 12 positions
    when i reach my target

  2. what i have found is that most people don’t have any plan
    they just say the market will go down or it will go up
    you can see clearly what my plan is and why i have made
    the plan. it is very simple and based on very sound logical
    thinking. if people have been reading my daily comments
    they will be able to follow this.
    too many people just comment about their education – like
    they have got Phd’s or that they have worked in the city
    and they know city people. what use is this. the market is
    an equal playing field for all people. obviously some people
    look down on people like me and comment. But there is no
    denying that i have consistenlty commented about my trading

    1. Nitup V I have read your posts with great interest, keep it up, thanks for posting and good look!

    2. Well Nitup, If we to go by YOUR prediction then you have only 6 trading days to get to your target of 7100 or thereabout. That would make 10% rise from where we are today. So let me tell you now, FAT CHANCE!!….I have been reading your comments and the “logical thinking” is only logical to you. Nothing wrong with that ,just stop jumping when someone doesn’t agree with you. To take us higher in the market we need a catalyst and I just don’t see one on the horizon. You make your prediction and strategy based on last year movements of the market. There is no new investors coming the market, its old money being reused again and again by daily traders. don’t forget we have now $55B of QE, that is $35B less then this time last year. The US government is still sealing the same amount of bonds so the $35B have to come from somewhere. That means less money going in the stock market to buy shares

  7. Haha your a funny guy Nitup V did not see you posting on Friday afternoon when the ftse was nose diving

    1. my dear friend – kindly read my comments. posting just because
      a few minutes of hours have passed – or a minute by minute
      commentry about my positions – is there any reason why you want me to do that.
      a plan is a plan is a plan.
      pls read above for the details of my plan

  8. Jim

    obviously your measurement is based on the cumulative price action
    based on the rate of change – as opposed to price action levels
    and this is what you use to derive your signal

  10. Nitup ur saying u dmt give minute by minute commentary..yet u do wen market moves in ur favour.. n right now ur in slight loss i presume

    1. genius – I leave that to you. Most of your comments
      have a touch of that along with quite irrational
      exuberance.

      Explanatory & logical – yes I try to be as far as possible

    1. You are a really funny guy – your language
      is really colourful
      ” Sinking” ” Nose diving “

  14. hashmash / luke

    if you do not see my comments for a little while
    – reason is only that I have to take the car to the
    garage. so I just want to fore warn you before
    you come up with some irrational explanation

    1. I am really surprise and disappointed that for a guy with your strategies, logic and knowledge of the market you don’t have someone to do this for you??!!. You should be sitting on tones of money by now!!

  15. I have just closed my short at 25 on sidelines now till after lunch.
    I am expecting further down side this afternoon though

  17. Thanks Mark A…… Nitup V like I said before I can see your new trading your own ignorance will be your down fall there a old say bull make money bear make pigs get slaughter!!

  20. FTSE 15 mins. —
    Rising support line from last Friday 21st about 20:00. Current value ≈6525. We’ll see if it holds.

  22. If you look at the FTSE on the 4hour chart this is looking very similar to what happened late Jan/early Feb ie a descending triangle of lower highs which finally gave way to a 100 point drop before recommencing the climb back up. Still sitting on the sidelines until the it either breaks below 6000 or breaks north out of this triangle. I am ready to go long once I am convinced the upswing has really started – jury remains out on my indicators as to which way we are headed

  28. apart from the order to buy at 6580 – I have now
    placed another order at 6600
    so – yes – you can infer – that is where the market will
    go to – based on my analysis

    1. very annoying, nothing more.
      Bought Thursday for a run to at least 6600 and nothing, only 24 points profit. US gone to all time highs in the meantime.
      Do not going to bet here, but I still think this is going to the upside. It is in the bottom of a weekly bull pennant. NO way it will break, unless some wild card from Russia…

      1. thats why i said i think the best trade is to short ftse long snp..n thats what my strategy is showing, its just i dont know howto get a good execution on snp..im trying to learn

  30. Muan what about shooting stars on Dow FTSE friday
    To me this not going up to 6600 before it sees at least 6450
    That’s why I am looking to go short this afternoon

  36. on the sidelines, didnt trade much last week, will not trade today either, unless something obvious jumps from the charts and slaps me around the face

  38. So annoying – went long at 6568 and the very moment afterward, it dives. Stopped out at 6548.

  40. Looks more & more like the bulls are just
    clearing the shorts out of the way – so that
    there is a clear uninterrupted way higher
    my 6580 will get triggered

  41. Nitup
    At which point would you consider closing all the longs you are opening IF this drop continued over coming months??

  42. very clear low formation in dow & s&P –
    in fact i stand correcte – not only my 6580
    but my 6600 trade will get triggered

  44. marco

    Yes i understand your question
    But you must see it 180 degrees in the other direction

    we are in a bull market – and your question will not arise.
    to me what matters is – how to maximise this move higher
    therefore you can see my plan clearly
    i am not doubling up
    this is a clear stratedgy to ensure a risk free trade

    1. risk free trade….hmm.
      Look at ftse now, and look at ur comment above..
      do u really not see ur arrogance?

  49. hashmash says:
    March 24, 2014 at 12:57 pm
    thats why i said i think the best trade is to short ftse long snp..n thats what my strategy is showing,

    Hasmash

    clearly you understand the – Neutral trade –
    but as a stratedgy – you are better to go & play golf instead
    a man who – tells that he could not understand
    the 50 : 50 rule – obviously – has come up with
    an awesome example

    1. lol idiot. dont even know how to argue with u.
      the trades u have running has a 50% chance of winning?

  52. Nitup V let me ask u 2 questions (maybe u are very smart and i couldnt understand ur 50:50 rule)
    Just simple yes/no answers.

    1. WHen u trade you have a 50% chance of winning?
    2.If a market is currently priced at 6000, the chance of it hitting 6010 OR 5950 is 50:50?

  53. ftse really going for it 🙂 lets get a close below 6500 today and all the shorters can then be happy

  54. Where is Nitup?? what on earth has happened to his strategy?? Mate, how are you going to get the 600 points or so in 5 trading days to prove all of us idiots wrong and You come on the top right??…do tell…

  55. hashmash

    1. yes
    2. yes

    3. Ask and answer the next question. this is where stratedgy
    and the 50 : 50 rule comes in.
    like the fed or BoE – they cant control what the market does
    but they use a stratedgy and the tools – like int. rate / bond purchase

    1. L.O.L
      Sorry i should not laugh if someone doesnt know anything, BUT U SIR are too arrogant to be dealt nicely with, however let me ask this.
      I would ask you about barrier options pricing as its a bit more better to make sense of this probability issue which “I” seem to be having.
      But lets take options as an example..
      FTSE STRIKE CALL AT 6600
      and
      FTSE STRIKE CALL AT 10000
      You are saying they will both be priced same?

  57. adam

    mate – i am not calling you anything.
    just watch as the stratedgy plays out.
    I am explaining everything to you.
    Obviously – you are unable to understand it
    that is ok. some people need to see more
    of it play out to comprehend it. so I will
    have patience for you. don’t worry. I will
    keep on explaining it to you.

    1. You know, I have been having fun with the market for a long time but I have never seen FTSE going up 10% in 5days!!!!…you need to call the guys with white jackets if you really think that this is going to happened ….lol

    2. tbh i wudnt mind buying S&P after its doodled around 1850 level for a couple 30 mins candles.

        1. I wouldnt mind buying S&P around 1850 level IF there has been a couple 30mins candles which are moving around that region – meaning if 1850 is showing support.
          But my indicator showing bulls dieing in S&P – maybe tmp..and this is what i mean by me not trading other markets as i do not know how to execute in there

  59. hashmash

    If anybody is able to offer a Ftse-10000 call option
    – even on the year 2025
    and he thinks that he could arrive at a price for this
    then – sir – he would get an immediate referral to
    Rampton secure hospital

    1. ok maybe u didnt get the point, or u figured out ur stupidity in ur logic.
      what about FTSE CALL STRIKES at 6600 and 6700
      according to ur 50/50 rule they will be priced the same

  60. Still trying to get a coherent answer! I think what he is saying is that as we are in a bull market it will always go back up in which case I don’t know why he just doesn’t put everything in long in one go – have tried myself and dismissed adding every x points as a good starting point is typically messed up when you buy the last position which is often close to a resistance point anyway and then it works against you so you end up with a losing position. Clearly not risk free as all bull markets eventually come to an end (and this one has been running a long time now) and even within this bull market it has fallen best part of 1000 points in which case you either need very deep pockets or you capitulate and close out.

    Still on sidelines – want to see a higher high on 4hour or equivalent on downside and even then will use momentum indicators to guide whether I enter or not. Am seeking 2-4week cycles until sentiment reverses – just not triggering so quiet day again.

    1. DavR0s…its just funny how arrogant he is and then points fingers at others saying they dont understand probability, like he points fingers at this guy who had a PhD in Physics and me (PhD as well in artificial intelligence)

      1. Yeh that was me and my point wasn’t I’m a hot trader because of the PhD it was that I have a basic grasp of maths and statistic (well I hope so)

        1. ye thats what i mean lol phd dont mean ur good trader but if u didnt understand basic probability u wudnt have a PhD let alone any mathematics related degree

  62. Adam

    what are you referring to exactly – 10% in 5 days?
    obviously somewhere along the transmission
    you have got a packet of information missing
    but – i am willing to hear what your confusion is!

    1. Nitup V…at this ill agree with u
      U said 7100 by april (as in end of april right)?
      even that is hard to believe lol

    2. There is no confusion on my side, just like hashmash said, YOU told us all (Thursday 20.03.14 last time) that FTSE will be at 7100 by April…

  63. bears standing strong in my indicator…
    hope we dont bounce from 6500 like last couple of times.

  65. hashmash

    i’ll reply to Davros – first

    I am not insulting your education – not one bit. I have and hold
    you chaps in very high esteem – in the FIELD you have Excelled in
    – But to make it a Point – that “I – the Phd Guy ” has an edge in
    Trading as a direct result of that is rather objectionable.

    infact I dont think it was you – but a MR GG – aparently he hires
    only graduate candidates for Global trading Houses. – and that
    he would not even consider a candidate without a Masters

    Trading – i am sorry – to point out – ( obviously you know this )
    is more about overcoming your basic animal instinct of fear & greed.

    In your comment earlier – you described a triangle / wedge – but
    you were not able to do anything with it – not even your Phd could
    overcome the basic fear & greed issue.

    so please – Trading – however much you wish – is a preety level
    playing field

    1. I will break what I said last week just once. Read my posts again – I ****haven’t *** said because I have a phd I am a better trade. The point I was making to someone else was that I hope I have a basic grasp of maths and stats as you were being somewhat disingenuous about our capability in that respect. Silence resumed – you clearly have a plan so good luck with that but I am not going to propagate endless posts given your general arrogant style.

  68. hashmash PhD as well in artificial intelligence

    same also applies to you.

    you are running a very similar programme to what i am
    but on the other side !

  69. hashmash & Davros

    correct me if i wrong please

    is it not the case that its the most basic principles that
    are the most difficult to solve

  71. I hope the regular bears are in Hashmash,Luke,etc. been a week since I last traded (too much work), thankfully picked up 20 points going short on ftse. Still think DOW will need some more downside possibly 16000 agen?

  73. Ahwab had a long this morning 20 points and a short this afternoon 25 points all trade done today mate sat in the garden reading the paper 🙂

  76. FTSE again doing nothing. US in a sell off and FTSE holding above 6500, lol.
    I would be tempted to go long in FTSE again, but it moves so slow.

      1. nope i’d get tired of it if the market moves up and my indicator reverses without me having made a nice profit loool.
        But so far the indicator has been staying strong.

          1. yeah well after working at hedge funds u cant really predict the market, especially in short term time frame which we most trade on…so u have to go with the flow..UNLESS u are a HFT.

          2. thats like the core principle in most hedge funds – u cannot predict markets, its profitable to trade with momentum.

          3. I also would say at this rate we will dip below 6500…if we dont then we will see same behaviour from ftse which we have seen for last couple of days

          5. does one have to explain every little detail..what idiot in the world would say ftse will go flat forever…pretty sure u can do something constructive instead of trying to pick stupid flaws in peoples comment.

            If ftse doesnt break 6500 then i expect to see similar behaviour until something sparks a breakout.

      1. i need the 6500 to break..if it doesnt then we will just see ftse sky rocket from there…
        Soon as i see a 5% reversal in my indicator im out..i don know when that will be, really has to depend on option/futures flow which side is taking bigger positions, cant predict that unfortunately 🙁

        1. OK thanks – I use different indicators to yours but i agree with your approach of not fixing a specific target but letting the market guide when it is turning or not. Its not making its mind up at the moment (at least with my indicators) but with Ukraine bubbling along still see potential for a 100 point further drop from here but suspect it will bounce up to 6800ish at some point in the not too distant future.

  80. HASH, you use Volumes, VPOC in the Futures contract, base value, etc… to see where are the areas of bigger volumes ?

  81. As for me – who can be ridiculed by the ” masters of the world ” and generally
    called an ” idiot ”

    things are still ok. I’ll still trade it as I said and leave the probabilities and
    other complex parameters for those who can understand it.

    But I did say a stupid statement – which can be ignored – unless you have
    access to a chart or ftse data

    Nitup V says:
    March 24, 2014 at 9:46 am
    Looks like everything is going to plan
    my longs are still working at 6500 6520
    6540 & 6560
    There may be one last dip to 6510 – and
    this will provide the only oppurtunity to
    buy at 6500 area.

  82. Looking at the FTSE in isolation, seems that support ≈ 6520 has held. The daily timeframe still holds the prospect of recovery. Perhaps stronger indications tomorrow? 🙂

    2. so u are like nitup v as well lol?
      Just because i didnt reply u assume i dont know..
      There MANY MANY things i dont know (I dont know more things then i do know)
      But yes i do know what VPOC and POC are
      AND
      NO I DONT USE THEM

  88. Well i didnt say all my trades are 100% correct lool. As long as my losing trades incurr in minimal loss, im happy.

  90. Well had a nice day relaxing in the garden my usd/cad short which I posted last week is now in good profit so have taken 50% and left 50% at break even, being a little greedy but what the hell.
    As for the ftse would now say a based is formed round 6500 so bear need to be careful now.

  95. Is my 6600 going to get triggered –
    not much hope for that till we see 6560
    – what a shame

  96. Missed that 6460 (6520) in Futures overnight. Never reached.
    We are for a rebound here… price already above MA10 in intraday…1st time since the top
    Looking to buy in a dip and hold a couple of days…

      1. Why ?

        No! The plan is still the same – buy at 6600 & every 20 after that

        I have 6500 / 6520 / 6540 / 6560 / 6580 now

  99. Waiting now for buying the dip.
    The price never reached 6520 in overnight. Had a order placed :(((((((

        1. Nitup V says:
          March 25, 2014 at 9:07 am
          all I can say to you is that I doubt my 6600 buy
          order will get hit

  103. Nick, what you mean by that statement ? Dip and Rise bull tuesday
    I see a rise and no dip yet

  104. It has been a choppy 2014. No decisive trend in US, very difficult to make money in this environment. Cannot hold positions for more than a couple of days…will be stopped in my profits.

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