6556 support, 6609 resistance today…

Good morning. The FTSE plan for yesterday worked pretty well with the dip from the 6596 down to 6558 and rise, though it stalled at 6590 rather than reaching the 6606 level (which maybe would have been too perfect) before the US come online, and gave a massive V sign to the world with the price action, dragging the FTSE down from 6590 to 6501 then bouncing back to 6590 this morning. Was certainly volatile anyway, not helped by the Ukraine situation rumbling on.

The main overnight news is that China’s expansion moderated to the weakest pace in six quarters and property construction plunged, testing leaders’ commitment to keep reining in credit as risks mount of a deeper slowdown.

Asia Overnight from Bloomberg
Asian stocks rose for the first time in four days, with the regional benchmark index climbing from a two-week low, after U.S. technology shares rose and investors weighed slowing Chinese economic growth.

Chinese Data
Gross domestic product rose 7.4 percent in the January-to-March period from a year earlier, the statistics bureau said today in Beijing, compared with the 7.3 percent median estimate in a Bloomberg News survey of analysts. Industrial production and fixed-asset investment trailed projections.

The weakest first-quarter property-investment growth since 2009 signals credit is tight and demand is faltering, adding to economic and default dangers as Premier Li Keqiang grapples with risks from shadow banking and local-government debt. A deeper slowdown would put pressure on leaders to expand stimulus or limit the pace of changes intended to give market forces a bigger role in the world’s second-largest economy.

Investors are “slightly more positive after this set of Chinese data,” Peter Esho, Sydney-based chief market analyst at Invast Securities Co., said by phone. “The big thing is that there’s an absence of real negative news. The wildcard is still that the Chinese announce some form of stimulus in the next couple of weeks.’

The MSCI Asia Pacific Index added 0.7 percent to 138.11 as of 10:51 a.m. in Hong Kong, with all 10 industry groups rising. The measure closed yesterday at its lowest in two weeks, taking its loss this year to 2.9 percent, as a stronger yen weighs on the earnings outlook for Japanese exporters and concern grows that China’s expansion is waning.

China Slowdown
China’s economy expanded an annualized 7.4 percent in the three months through March, the slowest pace in six quarters. Economists surveyed by Bloomberg News had expected a 7.3 percent advance, and growth slowed from 7.7 percent in the last quarter of 2013. Industrial production increased 8.8 percent in March from a year earlier, less than projected, while first-quarter fixed-asset investment trailed estimates.

”The GDP number is not bad,” Zhiwei Zhang, Hong Kong-based chief economist for China at Nomura Holdings Inc., told Bloomberg TV. “Industrial production improved a little bit and there will be a debate in the market as to whether this is a temporary recovery or a sustainable recovery. We think it’s temporary. Momentum will again slow in the second quarter and this is mostly driven by the property sector slowdown.”

Standard & Poor’s 500 Index futures rose 0.3 percent today after the U.S. equities gauge yesterday gained 0.7 percent as earnings from Coca-Cola Co. and Johnson & Johnson overshadowed concerns that tensions in Ukraine are worsening.

FTSE Outlook

FTSE 100 Prediction
FTSE 100 Prediction

The trade plan worked well yesterday with the dip from the 6596 area to the 6558 pivot (slight overshoot) before climbing back and all looked good to hit the 6606 target until the US came online and the S&P dipped off the 10EMA on daily at 1842 taking the FTSE with it. And tumble it did, all the way to 6501. Anyway, for the FTSE today we are still looking good within the 10 day Bianca channel with resistance at 6609 and support at 6501 for today. Todays pivot is 6556 so with the recovery yesterday evening I think any dip to the pivot is likely to be bought as we could push up to the 6609, 6628 and 6670 areas soon.

We are currently in a double top with yesterday area at 6587 so a dip from here would make technical sense, bit of a repeat of yesterday in fact. The US might be a bit more optimistic later today as well if they continue yesterdays buying.

There is a pretty decent rising 30 minute channel with extremes at 6535 and 6643 so that is the slightly wider range for today. If the bottom of the channel were to break then a revisit of 6512 is likely.

108 Comments

  9. Russian tanks just arrived at the city hall in slaviansk in ukraine. Could be an interesting day

  12. lol, you think markets at this point are still interesting in what Ukraine
    is doing?
    I’ve been away of markets and time to time take a peep in markets, how are they doing.
    And my perception is that…not seeing any sell off or moves with Ukraine bull***

  16. Hi guys,

    Fairly new to reading charts. Am I right in thinking at if we don’t breach 6594 by around 12.30 then we’ll be looking at 6530 this afternoon?

  17. anyone can help me, what is the advantage of buying FTSE futures JUN instead of SEP ?
    I see… if buying the SEP and my target is not reached until JUL, I avoid a roll-over of JUN contract. Makes sense ? or missing something.

  23. I’m learning not to be greedy and catch every point and find when Dow comes in it is very difficult to play so I am looking to get out from 12-12.45

  25. Long and strong from 6572 – added more at 53.
    – Would really like to see something of a postive indicator somewhere.
    Every lower low is followed by a retracement and then a lower low.
    Need some kind of reversal in this pattern !!

    1. Well, we may have a some problems… the unemployment figures are bellow BE guidance so the raise in interest rates could be on the way or at list very heated discussion among the members and that may be a big obstacles for the market. As you can see FTSE is not as strong as other European markets today or as it was before the announcement

  26. Went long at 6558-60 – 1/3 of my position. Not looking to hold too long. I had resistance at 6576 which it rejected earlier so will see if it can get through that level. Will sell as soon as it struggles to break any of the upward resistance levels as not expecting a big rally. Also if Ukraine were to deteriorate badly still think this would knock the markets back

  27. Ubu
    As I trade only mornings now I have a maximum of only 2 trades a day. I will calculate pivot and resistance/ support points night before so at 7.59 I am watching my IG app live at 8 market will generally rally to one of the support/resistance points within first 10 mins. It then generally reverses for the morning session which generally lasts till 10/11 am then there is generally a reversal till 12.30/1 pm. Today from R2 at 6593 I shorted which was at 8.06 am and then aimed for pivot which I could see would be hit around 10-11 then reversal now for me till lunch. Once Dow kicks in hell knows what goes on although for your info I have found a tendency for afternoon session to follow direction of the morning session from 8.10am so for today I would say down after lunch but I don’t trade afternoon anymore and find any more than 2 trades a day for me is risky. Hope this helps I also use patterns looking across the times find 30 min and 1 hour and daily good

  28. Nick, from your message, for the long at 6557 (which was absolutely brilliant) youve said to target 6628.possibly 6670.
    Whats your timescale for that?
    Cant be today surely!

    1. This one is going to be difficult even for Nick. The market is really unpredictable and the technical indicators don’t mean much this days…lol… on Monday he plotted his arrows for market to g down and it went UP, yesterday he said it will go UP and it went down…lol…

      1. And its for that reason that i trade the mornings, and leave the yanks to their unpredictable games in the afternoon. Yesterday worked great, dip and rise, just trail stops so when the rise faltered at 6595 and then started dropping back you still win. Same as today. Short the open, long at 6556, stop now trailing and half off at 6579. Yanks can do what they like this afternoon. 6628 is a resistance and 6670 after that. Might be reached, might not. In trade profit taken and rest locked in. whats not to like!?

        1. I have no idea how you managed to get 6595. It’s only been for a couple of minutes at that area at 8.04 Magic prediction?
          As I understand your stop loss was 6616 or something? And also long at 6656, it was only a minute or two at 10.44-47 at that price. You are Dynamo to predict it so exactly. Any reason for those decisions? I am impressed.

  32. Find this one works for me

    Fibonacci Pivot Points

    Fibonacci Pivot Points start just the same as Standard Pivot Points. From the base Pivot Point, Fibonacci multiples of the high-low differential are added to form resistance levels and subtracted to form support levels.

    Pivot Point (P) = (High + Low + Close)/3

    Support 1 (S1) = P – {.382 * (High – Low)}

    Support 2 (S2) = P – {.618 * (High – Low)}

    Support 3 (S3) = P – {1 * (High – Low)}

    Resistance 1 (R1) = P + {.382 * (High – Low)}

    Resistance 2 (R2) = P + {.618 * (High – Low)}

    Resistance 3 (R3) = P + {1 * (High – Low)}

  34. Belly
    At the moment defo above 80% note if by 8.10 reversal has not happened then its looking for a higher resistance point. It’s generally within 20 points of open
    Change in direction mid morning is identified by and sharp V shape on your chart when set to lines.

  36. I’ve already closed my long – snatched a few points profit as Dow and DAX started to drift down. Couldn’t manage resistance level of 6575- at least yet. Shows my low confidence in the ability of this to rally meaningfully at the moment !

  47. DEMOCIENCE – did you get out at 5690?

    Hate seeing some of the tales of things gone wrong on here, so genuinely hope you got out of your hole at your level! And maybe learnt a valuable lesson?

  48. Am watching it have brought stop up to 60, that massive double bottom might lean me to let it run up still watching

  57. I agree with that. The question is will there be a short option this afternoon? At the moment it just seems to have levelled off and good stick with in the 79-69 range

  59. anyone can help me, what is the advantage of buying FTSE futures JUN instead of SEP ?
    I see… if buying the SEP and my target is not reached until JUL, I avoid a roll-over of JUN contract. Makes sense ? or missing something.

        2. Muan

          Futures are seperate contracts / instruments which
          even though they track the Ftse index – are totally
          different.
          Spread betting companies use them as another
          instrument – that tracks the underlying Futures
          contract.
          The expiry of each of them are different – march/june
          Sept & dec. generally the nearest month is traded
          on the exchange – and only near the expiry – close
          to the month – the next contract becomes ” active “.
          As far as Spread Betting is concerned – Just trade
          the June Ftse – till about 2nd week of june then
          Close it 7 open Sept.
          But I am not sure why & what your question pertains
          to really ? What do you want to do ? I can probably
          answer the question better

    1. My mode has switched to mildly long now but i need it to hold this for at least one day before I will start to believe it!

        1. So what I look for is the daily and 4 hour trend to be in the same direction – and by trend i look at MACD, OBV, RSI and ADX and take an average measure. Once this occurs i buy the dips (or sell the rallies) depending on whether this is positive or negative. Week before last it was positive 5 days on the trot so i felt very comfortable buying fairy heavily on the dips and i made on every trade, even when it dropped it always bounced off the next level. Since then it has been oscillating, so some have worked and some not so lowered my stake – i categorise as up/down and neutral. It was neutral last 2 days and has gone positive today. Its still weak so a decent sell off would change things so i would only go maximum 1/2 points and probably just a 1/3 especially as Easter is upon us. The market has dipped a bit this evening so is just sitting below tomorrows pivot of 6579. Am hoping it rises a bit overnight or first thing, drops back and them ill buy. I dont set targets as I have no idea where the peaks and troughs will take us – i just try to systematically follow the trends what ever they are. This, for me, is all about getting onto a multi day rally (or sell off) but it hasnt done this for 3-4 weeks now so a bit frustrating. Still tweaking the process but its getting better each cycle

          1. Until the 21 ema does not crossover 55 ema at 4 hourly chart I will not buy. Only after and in the 1st dip.
            Until then it may be closing to a top

  61. Can I just check the market open over the easter. My main platfomr is IG.

    Believe the UK markets close tomorrow 4-30 and reopen 8am Tuesday. But FTSE on IG closes 10ish tomorrow night and reopens Sunday night. Anyone any idea what the spread is over this period ie is it 2 or 5 points during the day on Monday?

    1. 6500??!
      You are looking at a massive drop then, what makes you think that low?
      I know it’s been volatile, but not that big…
      Can’t see it go that low. US is back in the upswing…

  64. Roll up Roll up, best rollacoaster ride of your life. Get on the ftse and be treated to the best up and down rides of your life, it wont cost you a small penny, just a few K.. Don’t miss this once in a lifetime opportunity to lose everything you have…
    🙂

  67. RobGreen if my target at 6700 is not reached until JUL, what will be the benefit for me to buy Futures JUN spread betting ? I will pay the cost of roll-over to SEP

  69. Until the 21 ema does not crossover 55 ema at 4 hourly chart I will not buy. Only after and in the 1st dip.
    Until then it may be closing to a top

  76. I am belly but slightly concerned it has not bounced by 8.30 next support for me is S1 at 6553

  78. Marco

    Where do you have your Pivots pls

    April 17, 2014 at 8:19 am
    Pivot at 74 futures touched 6605 with dip firsts thing tells me going up this morning
    April 17, 2014 at 8:31 am
    I am belly but slightly concerned it has not bounced by 8.30 next support for me is S1 at 6553

    Not sure – my pivots are totally different

  80. Looks like a bounce off 65, be interesting to see Nicks chart when it comes out to see where he had it bouncing from if indeed he is also going long first thing.
    I had pivot at 6574

  86. Belly I will switch off now and start monitoring again at 9.50 as I will look to close between 10-11

  87. Marco – i was on a similar plan to you – pivot mid 6570s but didnt think the early spike up was very pronounced, so was more cautious on the pivot bounce – so waited for S1 in mid 6550s that didn’t come ! – so will continue to wait. Don’t want to get trapped in a losing position going into the long weekend if I can avoid it. Looks like it wants to retest the pivot again but it doesnt seem to have offered much support or resistance so far so likely to wait and see if it can get to S1 and see what the price action is like there

  88. Marco

    PP 74 S1 51 S2 19 S3 96 R1 7 R2 30 R3 62

    So not sure where you went long ?
    & you mentioned Futures touched 6605 ?

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