6675 support today

Good morning. All fairly quiet over the weekend  on the financial news front though Sunday night saw China vow to carry out the broadest expansion of economic freedoms since the 90’s. Nice long trade on Friday which was banked at just the right time as the FTSE failed to break the 6703 area, and never really got another chance. Prices didn’t fall really and just bounced in a fairly tight range for the rest of the day. We still have the top of the 10 day Bianca channel at 6711 to watch at the moment though I still expect the US markets to go for those round numbers – 1800 S&P and 16000 Dow – and probably a bit further to stop out the shorts that go on bang on those levels.

Asia Overnight from Bloomberg

Asian stocks rose for a third day, with the benchmark index extending a two-week high, after China vowed to carry out the broadest expansion of economic freedoms since at least the 1990s.

The MSCI Asia Pacific Index added 0.8 percent to 142.75 as of 1:35 p.m. in Tokyo after closing at the highest level since Oct. 31 last week. All 10 of the measure’s industry groups gained. China pledged to allow more private investment in state-controlled industries, ease its family-planning policy and expand farmers’ land rights, according to a Communist Party policy decision published by Xinhua News Agency on Nov. 15.

“The investors who were on the sidelines don’t have to hesitate anymore,” Zeng Xianzhao, an analyst at Everbright Securities Co. in Chongqing, said by phone today. “In the next few years, we will see faster implementation of these reforms and the efficiency of the enterprises will improve as well. There were noises about possible disappointment at the plenum; this got rid of all such negative rumors.”

US Futures

Futures on the Standard & Poor’s 500 Index declined 0.1 percent. The measure rose 1.6 percent last week to close at an all-time high after Janet Yellen, nominated to succeed Ben S. Bernanke as the Fed chairman, said the central bank should take care not to withdraw stimulus too early from an economy that is operating well below potential.

“They are not willing to move yet on tapering,” said Evan Lucas, Melbourne-based market strategist at IG Ltd. “That’s a positive thing for risk and that means equities are going to be in the green.”

FTSE Outlook

ftse 100 prediction
ftse 100 prediction

Fridays high of 6704 is the level that the bulls will need to break today and if they do then 6738 and 6780 are likely targets. If that high does break then hopping on the long trade should be fine, though I am mindful of the fact that he 10 day Bianca channel top is at 6711 for today. As with any bet, it’s a gamble. I am feeling slightly bullish at the start of this week, and think that we will definitely see those new record levels on the US markets – probably 1804 on the S&P (might go short at 1804 on this) and 16200 on the Dow (will need a major bull day today to reach this Dow level today though) but those 2 US index levels might tie up at roughly the same time.

Of interest on the FTSE is the ProTrend resistance line at 6715, which tallies with the Bianca 10 day channel top so I am expecting resistance there, at least initially, and the bulls really need to break that to achieve those higher targets – 6738 and 6780. I have put a buy the dip trade in below as I think that they will at least try and we will hit that 6715 though it remains to be seen if it breaks. If not then a drop back to the 6650 level is likely. The blue arrow is my main play for today and looks like it will be ok, but also watching 1804 S&P for a shorting opportunity. What it does at that 6715 level is 50/50 – up to the resistance or fall back down.

94 Comments

  1. 6695-700 area is very strong resistance, that is a sell area for me, we have a descending channel, and that is the top of it. Expecting to see 6650 tested today at least. Im Short.

    1. Looks like i spoke to soon. Next target area to add to short position is 6715-20 area that Nick has indicated

  2. Dax at nose bleed level see a few articles at the weekend saying they are trying to push too 10000 plus which would be ok if the ecomony and data warranted it but both are well below now and the dax is at 9218!!!

    1. Having lagged the other main indices, FTSE/daily is looking a lot more bullish as it begins to swing up. About time! Short-term channels ought to reorientate shortly.

  3. Euro up at 1.35 against the dollar ECB need a weaker euro to make export more desirable what next interest rates at 0.25 just a cat & mouse game.

  4. Andy you sure are a fickle trader, you said on the weekend we would get a drop, yet we hit 6720. Got my pips at 6710 so can’t complain. Should see a spike up on DOW open to see through 16000. Followed by some descent. We shall see…

    1. Not sure i understand. I got Short on Friday late to hold over weekend as i saw a drop Sunday evening into Monday… That proved to be correct. I then got took profits and got short again on FTSE at 6695, 6715 and 6725. We get a bounce on US Open but with the VIX as it is, the markets need a pull back before going higher. I see lower later today and tomorrow. Certainly agree markets will go much higher into New Year, but need to go lower first now.

  5. 6670 by close, but pretty sure that DOW if it dips will bring down further. If today ends negatively, we will see some good downside tomorrow

    1. 😀 crystal ball

      You people need to have steel balls to go short, after a break in 4 hourly chart down channel

  6. I know right PMS, for once I agree with you.., aside from the average level drops there is no indication of a free fall with the market so strong. With so many people shorting it would only propel the indices forward. However I do believe that we are in a crucial area so looking to short till close and see where that DOW & S&P goes as we are just making all time highs whole Ftse is dallying, the Ftse will sometime need to catch up with the DAX,DOW,etc. So at the moment buy the dips is the way to go

  7. agree with pms the trend and charts really against being short but ftse has been the place to be bearish

  8. Unfortunately not as the DOW is holding up now looking for 6780 ish for the retest today’s daily open, but will be locking in profits @6702 which I should be hit , and place a running stop. Looks to be a boring day now.

    1. US Markets are going for the Extreme Gap Fill from Friday… If it fails to bounce there we are in for a correction IMHO. Im Still Short and approaching breakeven :)… Holding for 6703 initially, but will be largely dependant on DOW/SPX, if they fall hard then FTSE will be looking at 6600 and below.

    1. Did you get Stopped? DOW hit 16028.9 lol… Why was your stop that… I was looking at 16050 area as a strong level to short from if it made it that far

        1. Wow. £13k loss, that is quite a serious sum. How you manage your risk is key to being a successful trader, its impossible to always get your trades right, therefore if you don’t have the discpline to use stop losses or cut your trade then at somepoint in time you’ll get wiped out. Really sorry to hear that Si

  9. Huh Sam how are these markets range Dow at 15929 this morning now 16006…. That not range bound Dax just closed at new time high so where is this range bound???

    1. After I closed my long from 6670 at 6724 I couldnt get a decent entry point, markets were mostly moving +/- 10 points. Just noticed gold dropped quite a bit after my post, well, gold is different kettle of fish though.

  10. Oh I see maybe range bound on shorter time frames but not on longer time… Plus lots of day traders love these small moving range bound markets they can skim good profit of them with little risk if tight stops are used.

    1. Thanks Luke, I tried with minimum stakes and made 20p profit, lol 🙂
      If I raise my stakes I will surely lose money.

  11. Put a long on right on support level 6670, decided to ‘profit take’ after a few points – thinking it was going to tank. Then spent all day shorting and longing and losing…. down 10K. Oh, what a f!”£$%^ idiot, why couldn’t I just have left that long on 🙁 Now am at break even on the Dow, hoping for massive bull run. 🙂 lol Thinking of giving this game up! You can’t ‘win’!

  12. Lol, on this day glad I got a position early morning, as I have a temptation like many traders so TRADE ALL THE TIME? Though after some years and painful experiences, this has subsided somewhat.

  13. short dow at 10 just beer money think will not close above 1800 in snp and close dead on 16000 dow very slow !

  14. Sam 20p profit still a profit mate and you have learn a little lesson some lose thousands many will give up but a small precent will learn from there mistake and become successful…. Got to learn before you can walk. Personally never been very good a scalping but each too there own.

  15. Because of the Gap Fill tomorrow. I have closed my Shorts at 6691 and gone LONG at 6692… Holding for some form of bounce in Europe tomorrow.

  16. well worked guys good day today good start after the harrowing week last week. is this adip or start of a pull back thats the question. nice when you buy on the way up and sell on the way down !

  17. Dave your chattin rubbish lol… your on a wind up with your stakes lol. £500 per pip is some monster positikn

  18. For all the talk of 100point drops the dow still ended the day up … vix moved 7% so something is brewing or just a hedge am happy to short these levels but have been saying that for some weeks…

  19. It’s going down Andy. Did the same trade this morning and it stopped out …. Tomorrow is the day … Already £10k up on the trade …. Limit at £50k

  20. To all the guys lamenting their big losses: if you really want to be a trader you can use the pain of the loss to your advantage, I’ve been there, only started in May last year so 18 months. I lost £30’000 first year and took a couple of months out to read my trading notes. This year I’m at break even which believe me is progress. My timescale to learn the basics was 2 years which should lead to consistently profits in year 3. I’m making progress and the length of time between my mistakes is increasing each time.

    I want this and I will succeed. Best of luck guys

  21. Got a binary ftse finish up to cover annoyance if ftse does go back up
    After which ill short again from 6720

  22. Hopefully my short will flow out nicely . B/e stop loss in place so cannot lose …. We’re having a slide today … What divi today ?

  23. Yep my bad there is a 7.4pt divi on Wed, tomorrow. Hopefully Dave we get an attempt at a Gap Fill early on so i can then join you short 🙂

  24. Hi Geoff ,

    You are the same position for si n me. Since I trader last year jun loss £31k.
    No way to recover
    Hope you can give a nice tip in the next few move .
    Regards

    1. Nice, I took a few more at 6683… Think we may see a short squeeze to new highs after studying my charts last night. The key is China, Daily & 60min charts show a squeeze higher, IHS formation in play here with IHS neckline support and Fib 61% Support, pointing to 6816 level. My Bearish stance has switched for now.

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