6524 support, 6574 resistance

Good morning. A day when not a lot happened really on the FTSE. I do have to thank the fat fingered oaf at HSBC though who spiked the price up to my short order at 6550 before price returned back to 6520 for some nice profit. The bulls tried again but still failed to break that 6474 level, not quite reaching the 6578 mentioned in the afternoon yesterday on the email. shame really as it dropped back to 6530 again! With today’s pivot at 6538 and looking at an open below that we might see some downside today. 15650 still beckons for the Dow, and that may coincide with a double bottom 6490 on FTSE. I still expect 6460 before too long though.

Bianca Trends
Bianca Trends

Asia Overnight from Bloomberg

Japan’s Topix index fell as the yen strengthened against the dollar, with the equity gauge capping its largest monthly decline since May 2012.

The Topix index slid 0.3 percent to 1,220.64 at the close in Tokyo. The measure dropped 3.5 percent this week and 6.3 percent for the month as weak economic data from China and a sell-off of emerging-market currencies sparked a global equities rout. The Nikkei 225 lost 0.6 percent today to 14,914.53. The yen gained 0.3 percent to 102.46 per dollar, poised for its steepest monthly rise since April 2012.

“It’s hard to tell just how far the chaos from the emerging-market currencies will spread globally,” said Yoshihisa Okamoto, the Tokyo-based head of equity research at Mizuho Asset Management Co. “In the FOMC statement, the Fed didn’t suggest there’s concern about emerging markets, and that’s causing unease among investors.”

The Federal Open Market Committee this week left unchanged its statement that it will probably hold its target interest rate near zero “well past the time” that unemployment falls below 6.5 percent, “especially if projected inflation” remains below the committee’s longer-run goal of 2 percent. The U.S. central bank said it will cut monthly bond purchases by a further $10 billion to $65 billion.

Exporters Drop

Futures on the Standard & Poor’s 500 Index sank less than 0.1 percent. The U.S. equity measure rose 1.1 percent yesterday erasing this week’s loss, as earnings topped estimates at companies from Facebook Inc. to PulteGroup Inc. and consumer spending climbed. The index had lost 1 percent the previous day as the Fed decided to cut monthly bond purchases by $10 billion.

Exporters fell. Toyota lost 1.3 percent to 5,922 yen. Nikon Corp. (7731), a camera maker, declined 2.1 percent to 1,769 yen.

Toshiba retreated 7.5 percent to 432 yen after posting third-quarter operating profit of 47.8 billion yen ($467 million). Analysts surveyed by Bloomberg had expected 72.5 billion yen.

Fujitsu surged 13 percent to 578 yen, the largest one-day gain since May 2009. Third-quarter net income of 12 billion yen topped the 7.9 billion yen estimate of analysts surveyed by Bloomberg.

FTSE Outlook

ftse 100 prediction
ftse 100 prediction

6574 seems to be the line ion the sand still and the level that the bulls need to break, and if so then 6614 and 6662 are the likely resistance points. Today’s pivot is 6538 where we are slightly below as I write this, so that may act as initial resistance, for a dip to 6524. If that were to break then the double bottom at 6490ish looks possible. I am still mindful of 2 levels – the 6460 support, and the weekly scenario posted last year which had a drop to 6200.  There is no really decent channel on the 30 minute chart at the moment, though the 10 minute has support at 6520 and resistance at 6545/50ish for an initial channel.

10min channel
10min channel

The bulls really need to get prices above 6650 to invalidate the drop potentials, but I think another dip is on the cards first, probably to the 6460 area.

107 Comments

  2. … Agreed this drops are getting more and more predictable, good be a good sign for the upturn, still think 6500ish is the bottom for a while 🙂

    1. 6490 then 6460 i have as next supports. Dropped off the top of that 10min channel at 6547 rather sharpish!

    1. tempted to start building longs at 10point intervals starting 6480 with a wide stop at 6400 for long term trade.

  4. Hi Nick and all, I was just looking at daily and it looks like ftse could be heading to the bottom of it at 6460.

    Is that the 6460 line you have drawn in on your chart?

      1. Thanks Sam….but my strategy is to trade at the close at 4:30pm. So 3 hours to go yet……in this market….could go anywhere!

  14. Well, the sentiment has change and the markets are on the way down. Don’t bee surprise to see 6000 on FTSE….just as I said few days ago after India and Turkey put the rates up they already talking about economic slowdown…lol…what a surprise

  16. for what its worth today!

    Fri, Jan 31, 2014 Mon, Feb 03, 2014 Outright Treasury Coupon Purchases 02/15/2018 – 10/31/2018 $3.75 – $4.75 billion

  18. I was waiting for the gap to fill on the DAX at the 9200 level, which it has now,
    BUT
    I still do not see any info as to why the markets have fallen ?

  19. I have no position on the FTSE here but I think any bounce from these sorts of levels could be very fast & furious….

  20. this could be another negative 300 pointer on dow when it opens may be tempted to go long from under 15600 on dow if so i can see ftse being down to sub 6400 by end of play or at some stage before dow closes tonight

  24. Btw, heres a tip for position entry…
    using barrier option equation (work out ur vol however u want).
    use the pivot/res/sup as ur barriers..
    and calculate the prob of hitting one of them..if u have a dcent prob of hitting it
    then use that as ur entry…and yes there will be alot of times where
    u miss out on a trade..
    but in the long run it works for me.
    This is not a solid rule of mine, but i do use it every trade, and there are
    times where i go against it, e.g annoucements or reversals etc.

  31. For the short term it probably will turn around today will go long on Dow and ftse when S&P hits 1760 with a tight stop probably around 15 pips on ftse and 40 on Dow .. Still see today as dump pump dump GL

  34. Was so convinced ftse would find good support at 6470-80 i left my long open. Then i find that its at 6550.
    Had to immediately hedge with a short on the ftse february.
    And its worked brilliantly. Not losing any more money, and can sell that short and buy dips for the long.

    1. Hope so – but my timeframes are longer. Looking for the indices to be higher at the end of April than they are today at the close.

        1. True James…..it’s why I make it clear what my timeframes are – so there is no confusion. However I like to think it is actually a more general Index Trading site.

          1. Ignore James, I value your posts Javed! Its good to discuss both intraday trades but also bigger picture trades…

          2. Absolutely agree.
            James is upset that the DOW went against him.

            James you still think my theory was wrong?
            🙂

        2. No Idea what your theory was HAVIES…

          LIKE I said i was waiting for the dax to close the gap at 9200 area then I was buying the market..
          what i asked was why is the markets going down, which no one could answer…

        3. BY the way HAVIES, I DID MENTION AT 13.32 you should buy the market….

          keep your theory deal in facts.

          1. Lol, so dramatic.

            Like I said before James, overbought and overvalued markets, that’s why it was falling…no other reason 🙂

            And I keep to my theory, let’s see end if year results for the DOW 🙂

            Gl James 😉

          2. you trade in your yearly’s
            I trade in my DAY TRADES…

            Oh and good shout from you at 4.15 today that you think the market is going up…in an up trend hahaha
            It’s been in an up trend for months..
            or did you mean this year?
            or this aftermarket hours ?

  41. S&P didn’t hit 1760 and I think that’s show a bit if a strength lately supports and resistances didn’t work well on ftse so I look to the S&P to trade the ftse

  42. My prediction for FTSE was 6300 since December.
    Not far off, but I am inclined to say we are about to see some uptime again.

    Don’t know if there are further declines, but definitely think the markets corrected itself nicely, leaving us with decent growth prospective for the year.

    I am now long and will keep buying the dips, if they come…

    GL all.

  43. I’ve lost quite a bit of money this week on the Dow. It went good then very bad. Now I’m holding a long position with the FTSE from 6420 but it’s been at this resistance point of around 6465 for a while now so unsure if to close the position :/ Decisions decisions!

      1. Yeah thanks. Protecting a 45 point position could never be a bad decision in the grand scheme of things even though we’re much higher now

  46. I hope so. Did not see the low in SPX yet. I saw it only in after hours. Sometimes this happens and the reversal has already taken place in after hours, this morning.
    But I suspect we may see again that low today. They do not want holding long positions before the China data this weekend.

  48. This uptrend looks quite strong.
    Like I said, not expecting any lows again. Think we got our correction and time for some uptime 🙂

  50. What a bummer! Two longs at 6460 and 6450 got stopped at b/e 🙁 and now 6500+
    Well, didn’t lose money – consolation.
    Done for the day, gl all.

  53. Bullish divergence between #DOW and $Trans.
    Maybe a DOJI in weekly chart today – Dow
    Hmmmmmm

  54. … You’ve gotta love the USA, ftse off 2% plus for the week! Dax 1%! S&P probably going to be up, likewise Dow, quite incredible, the only way the Ftse is going to reach 7000 is if the US gets 1950 & 17500. 🙂

  60. It was u.s federal chairman ben bernankes last day in office whether that effected markets or not who knows but looks like Dow could go just under 200 day ma before we rise again in next week or so dragging ftse with it

  63. I agree that depending on your timeframes this is a good buying opportunity. Based on the median monthly moves for the last 30 years I am expecting the FTSE to be near 6700 at the end of April…..in reality probably higher. But yes we may go lower before then……hit the oft mentioned 6338 one more time before the rally kicks in.

    1. Thanks Javed, views expressed by u, nick, Jim, pms and others are very much appreciated. It would be useful if you could post charts, like Jim and nick.

      1. Thanks Sam great to get feedback. 🙂 FTSE/daily — The indicator featured in the chart has recovered a bit over the past few days, but it is in negative territory and seems likely to post a descending peak. If that happens, the FTSE will be on its way to below 6400. I doubt if it would ease much before falling to ≈6350. Otherwise, the bias seems to be negative: the gradient of the ϵ-channel running from the beginning of the year is negative, LinReg 20 < LinReg 100 and both are pointing down, and the index continues to slide in the lower track of the channel.

        http://imageshack.com/a/img802/2469/lkeb.png

  65. Thanks Sam……I would if I wasn’t so useless with technology. Jim you will have to tell me how to upload charts one day.

  66. Like the weekly chart SPX since 2011. Looks very interesting for long positions.
    Look at my chart on twitter

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