Good morning. Well the short at 6670 didn’t really work yesterday but then flipping to the long for a run up to 6700 did. The lower level support at 6642 held much better than I was expecting, though we are now testing the top of the 2 Bianca channels at 6702 and 6707 this morning. Gold looks like it might start a new up leg which would tally with a decline in equities. UK GDP figures are out later, at half 9, forecasted to be 3.1% YoY and 0.8% QoQ. We also have Options expiry so expect a bit of choppiness around 10:10am.
Asia Overnight from Bloomberg
Asian stocks fluctuated, with the regional benchmark index headed for its best weekly rally since March, as investors weighed earnings, Ukraine developments and weak economic data that fueled bets central banks will maintain stimulus.
The MSCI Asia Pacific Index (MXAP) added less than 0.1 percent to 147.91 as of 11:47 a.m.,in Hong Kong, swinging for a loss of 0.1 percent. The gauge is headed for a 2.6 percent rally this week, the most since the period ended March 28. President Vladimir Putin said Russia will do everything it can to stop the conflict in eastern Ukraine.
“History tells us not to take these things at face value regarding what Russia is up to and I think we can error on the side of cynicism,” said Tim Schroeders, a portfolio manager who helps manage $1 billion in equities at Pengana Capital Ltd. in Melbourne. “We’ve seen a myriad of weaker-than-expected economic data from Japan to Europe and even to the U.S. That’s buoyed investor sentiment with regards to maintaining monetary stimulus longer.”
Regional Indexes
Japan’s Topix (TPX) index fell 0.1 percent. Australia’s S&P/ASX 200 Index added 0.4 percent and New Zealand’s NZX 50 Index rose 0.3 percent. Taiwan’s Taiex index lost 0.2 percent and Singapore’s Straits Times Index advanced 0.4 percent. Markets in South Korea and India are closed.
The Shanghai Composite Index rose 0.8 percent, while Hong Kong’s benchmark Hang Seng Index gained 0.7 percent. The Hang Seng China Enterprises Index of mainland stocks traded in the city rose 0.5.
Russia proposed a cease-fire for humanitarian aid deliveries to war-torn parts of southeastern Ukraine as a convoy of aid trucks from Moscow waited near the border with rebel-held areas. Even as Russia struck a conciliatory note, journalists at news outlets including Novoye Vremya and Hromadske TV reported seeing armored personnel vehicles crossing into Ukraine.
The euro area’s recovery unexpectedly stalled in the second quarter as its three biggest economies failed to grow, underlining the vulnerability of the region to weak inflation and the deepening crisis in Ukraine.
The monetary union’s gross domestic product in the three months through June was unchanged from the first quarter, when it increased 0.2 percent, Eurostat, the European Union’s statistics office in Luxembourg, said yesterday.
Weak Data
This week, data showed Japan’s economy contracted the most since 2011, China credit growth and industrial production missed estimates, and U.S. retail sales stalled.
Futures on the Standard & Poor’s 500 Index were little changed today. The measure gained 0.4 percent yesterday after a report showed applications for unemployment benefits rose more than forecast last week. Jobless claims climbed to the highest in six weeks, according to the Labor Department.
FTSE Outlook
Todays pivot point is 6674, and we have a rising PRT channel line offering support at 6679. As such, after an initial dip from the daily channels we might find support around this area for a bounce to the other major resistance at 6724. Below the pivot the next support is 6651, a break of which would lead to 6621. Gold looks to be starting a leg up which may coincide with a turn down in equites after this recent bounce, especially as we are testing the 20 day raff channel tops on Dax, S&P and FTSE. Shorting the rallies feels a bit safer at this exact moment, though the bears seemed pretty weak yesterday.
Hi guys. Yesterday late evening I saw a similar pattern on FTSE that lead to the 6000 break. I was astounding by the similarity. I do not know at this time if I was dreaming. I wanna check up again and take some snapshots to place in twitter.
We are now in the final leg up, that will lead to the 7000 break, if this pattern has to repeat
Pms agree with you this is last leg up of desending wedge taking us up through 7000.
Just gone short 6735
Curious — when you are bullish how come you are shorting it?
7000? A bit exaggerated.
I find that however bullish this leg may seem at the end of it both daily , 4hr are showing bearish divergences. I feel that this is the last push higher which will fail very badly and send us on a slow move towards the 6300 area. As they say when everthing looks rosy it often signals a fall
It crossed above 61.8% on FTSE and didn’t reach 61.8% on Dow and yes, I also hope it will drop down when Dow reaches 61.8%.
Look at S&P a classic bearish wedge on the daily .
Yes, it looks like this. But don’t forget the strong uptrend is not that easy to break. It may resume at any opportunity, and now it’s an opportunity to test highs once again.
Rental I am a day trader so bilieve we have peaked for the day now so a back test of 6700 is coming before growth north. I will trade either way always conscious of trend.
Nice one Marco, good drop there!
Well, I found it, not exactly the same picture I thought I saw ( it reached +-6100 several times, before a convinced break ), but we have to think that this levels were trade before in the last bull markets, and we are now trying to conquer new territory
FTSE/daily — If LinReg 100 turns up we might get an extended run up to ≈ 7000. I shall look out for that. LinReg 20 has already turned to point up and the FTSE is up about 200 points on last Friday’s low. But I’m also looking out for a local max in the index around 6750 — this would give us another descending peak in the daily series, and point to 6500 as a likely destination.
We need a close today above 6725, so we go next week for a move to highs
careful with those shorts. F>TSE broke the 200ma. We all know what happens next
FTSE/1 hr. — LinReg 100 crossed above SMA 200 2 days ago — SMA 200 gradient has just turned positive today. Not being ignored! 😀
PMS. —- you seem to be spot on. Wht is this pattern that you are talking about. Would you mind sharing it on this site . Much appreciated.
JIM. —- what is your basis of interpreting the charts. Inhave read books on charting and trying to apply it to make sence of the moves but just cant get it right. You & PMS seem to get it preety spot on most of thre time
Wow look at this go. News driven ?? Or was it the pattern on the charts. Bear wedge and H&S ??
Scalped £500 on that DAX look at that -200 pips in 30 mins
Closed my short at 6702
Oh, dear. Missed that drop as I was collecting my child. Wished I could capitalize on something.
Hurray, I also got +20 points.
RC — I wish you luck in collecting loads of rent from any spread betting company!
— I tend to favour linear regressions as opposed to standard moving averages. I refer to them as LinReg 100, LinReg 20 etc. I feel that they do a good job of tracking series.
— I am not very keen on the idea that an observed, close-up, pattern in a series has much influence on what follows next! I am interested in momentum and, often short-lived, direction.
— I tend to look at a couple of timeframes at the same time. At the moment, 1 hr. and 5 mins.
— It’s interesting to explore ideas in connection with series which exhibit a degree of randomness! I try to keep it simple, e.g., I’m working at the moment with an indicator which identifies simultaneous growth in two separate timeframes. If the growth profiles are attractive in 5-min. and 1-hr. timeframes, say, then that augurs well for the short term and perhaps a day or two beyond that. A current example produced by this technique is shown below.
Good luck! 😀
http://i1348.photobucket.com/albums/p736/jmca01/SainsburyJPLCDFB_zpsd89b3e88.png
Just log in… uiiii… that close was not very pretty indeed. It managed to close below the 200ma for the week, but above the 50 ma in weekly chart. Did not liked that candle…
6680 hold, but not sure what next… ugly close…. maybe a breadth from recent bounce… who knows. It’s Friday
The weekly chart nothing to report. Very positive close. But the daily arrgghh, very ugly…. the Ukraine sentiment still very alive. Putin with double interpretations…if it wasn’t for that…
Just read the news… now I understand…. son of “Putin” – filho da puta
From the BBC
Meanwhile Ukraine’s Foreign Minister Pavlo Klimkin sent out a tweet saying he would be meeting Russia’s Sergei Lavrov in Berlin on Sunday, along with their French and German counterparts, adding: “We need to talk.”
Yeh you definality need too talk!
I hate trading in August! Must have said that a few times…..August is for recharging the batteries in the Hamptons. One day perhaps.
Anyway I closed my short at July monthend at 6720……unluckily the 6600 which I bored everyone with for weeks came but a few days to late. My long for August was looking for a while today. Still think we end up being positive but no one can tell in the month of August.
Been a quiet year….well from February onwards….been virtually flat for me.
Here’s hoping the final 3rd of the year will be better. Gosh where has the year gone……?
It has flown by hasn’t it!
Kiev, Ukraine (CNN) – The Ukrainian government has recognized the contents of a Russian convoy as humanitarian aid for war-weary civilians in the eastern part of the country, according to a statement from the Ukrainian Cabinet office.
This could finally be a bit of good news for European indices.