6807, 6784 Support, 6818, 6830, 6874 Resistance

Good morning. Well that dropped at the open as expected, but then never stopped for the most of the day. Long off the pivot got scuppered too unfortunately, and it was the 6765 level that eventually saw some support come in and a bit of a climb back above 6800. All quite surprising as the S&P was relatively strong yesterday and is only just below 2000. Could have been a ruse to trap some bears (bear trap) and we now get a rise. We also have another YouGov poll out regarding the Scottish vote, FTSE rose as the No vote is int he lead this time, 52-48. Will that rise continue today?

Asia Overnight from Bloomberg
The dollar headed for its biggest weekly gain versus major peers since November and precious metals retreated as investors assessed the U.S.-rates outlook before the Federal Reserve meets next week. Asian stocks slipped after Chinese lending data as wheat dropped.

The Bloomberg Dollar Spot Index climbed less than 0.1 percent by 2:09 p.m. in Tokyo, with the yen at an almost six-year low versus the greenback. Gold retreated 0.6 percent, heading for its biggest weekly drop since May, and silver plunged 1 percent. The MSCI Asia Pacific Index (MXAP) lost 0.4 percent, set for its longest losing streak in four years. Standard & Poor’s 500 Index futures were little changed. Wheat was near its lowest price since 2010.

The U.S. currency has rallied the last four weeks as U.S. economic reports spurred speculation the Fed will raise interest rates sooner than previously estimated. China’s aggregate financing and money-supply growth missed estimates, while 702.5 billion yuan ($114.5 billion) of new loans were extended in August, close to the 700 billion estimate of economists. Reports on industrial production and retail sales are due tomorrow. Euro-area industrial output is also due, as the latest round of sanctions against Russia take effect.

“There has been quite a significant shift in terms of interest-rate expectations in the U.S.,” said Mitul Kotecha, the Singapore-based head of Asia-Pacific foreign-exchange strategy at Barclays Plc. “Higher U.S. yields combined with the relative outperformance of U.S. data is helping to propel the dollar forward. There’s a real contrast now between expectations of U.S. monetary policy and Europe and Japan.”

Hang Seng
The China data come after figures yesterday showed consumer-price growth slowed more than economists expected in August and producer prices dropped 1.2 percent, exceeding the 1.1 percent decrease predicted by analysts.

The Hang Seng Index (HSI) slid 0.4 percent and the Hang Seng China Enterprises Index of Chinese companies listed in hong Kong retreated 0.3 percent. Volume was about 13 percent less than the 30-day average for the time of day on Hong Kong’s benchmark index.

Gold slipped to $1,233.95 an ounce in a third day of declines. The metal has lost 2.7 percent this week and touched $1,232.33 today, its lowest intraday price since Jan. 23 on the spot market. Silver dropped to as low as $18.4675, the lowest intraday price since June 28, 2013, while platinum and palladium fell at least 0.4 percent today.

President Barack Obama has pledged more air strikes against the Islamic State extremists that have spread from Syria into Iraq, and said the U.S. would join the European Union in imposing more sanctions on Russia for its support of separatists in Ukraine. Oil rallied yesterday on the measures, helping the S&P 500 to erase a drop of as much as 0.5 percent.

FTSE Outlook

FTSE 100 Prediction
FTSE 100 Prediction

Todays pivot is 6807 so there may be initial support there, though the bottom of the Bianca channel js 6784 for today. There is initial resistance today at 6818, the bulls will need to break that to target 6830 and 6874 which are the 2 main resistance areas coming up; coupled with the top of the 30 minute channel at 6845ish. For today I can see an initial dip but then a rise again – the S&P looks like it wants to push on, and if that 1986 was the low then could well be on the way to 2020 or slightly more. Still have a buy the sdip stance at the moment, just yesterdays dip was overdone!

I have plotted the arrows dipping to the bottom of that 10 day Bianca channel but it might only get to the pivot at 6807 (also 25ema on daily at 6804) before climbing. 30 minute EMAs are currently weakly positive.

41 Comments

  1. An update to the signals from the software.
    No change. Buy order from yesterday still active
    Buy 6790 & 6800. target 6853 & 6860.
    Looks like it is not going to work.

  2. Does anybody else use software to generate Buy / Sell signals.
    If so – could you detail it and if possible post the signals here
    Much appreciated.

  3. Wow, my paper-trade from pivot 17041 fat 15.20 was actually short lived but still would bag me 40 points if I was to get out on time. Pleased that wasn’t a bad idea after all. Now I’m off to an early birthday party. See you next week. 🙂

  4. Bottled and closed short 6805 eradicated my losses over last couple weeks will start a fresh next week in a very small profit! At last ! I might buy one glass of champagne.thanks nick and everyone.cheers

      1. Hi Senu,

        I have tried this type of scalping in the past and had not be profitable in the long run. Any thoughts ?

  16. Just an update
    Another buy signal came at 6800 at 3pm
    So really – nothing else new.
    So I suppose – its stautus quo.
    Targets as before 6853 & 6860

    1. One thing I suppose – the parameters have not been breached.
      The Buys from Yesterday at 6790 & 6800 have not been taken out.
      Targets are still active ( I suppose !!) . So I can’t really judge one way or the other.

      1. Saying all this – the software has performed 7/8 out of 10.
        1. If I had taken all the signals – I would not have lost on any trade – with one proviso – after 5-10 pips a stop was placed at breakeven
        2. Profit targets – 70-80% were hit – some with substantial gains like yesterdays
        3. it certainly has kept me out of trades that I would have taken and lost money – like yesterdays – I was certain it would go higher – & what did it do. ( I suppose this itself should score it 10 out of 10 )

  17. RC – What is this software. Haven’t been around all week so you may have already said – but I missed it…

  20. I booked profits from my yesterday’s trade. Short at 17030 closed at 16951. Lucky my stop at 17081 didn’t hit. It got upto 17069. Have a good weekend all.

    Dow still has some more downside hopefully will find a good entry on Monday.

  23. Hi Jack2..you have done really well with your account. The key is consistency and if it comes at a slower pace that’s fine until you know exactly what you are doing.
    I would say one thing to you, most of your trade entries are good and very logical but the problem is you close it too quickly before the nice move actually happens in you favour.
    For instance your rejection signal trade at 17040 was a good one with nice risk/reward ration but you missed it I don’t know why. If you resist the temptation of closing it too early you would have made more money.

    2. You noticed that too (that I cannot hold). It’s just fear and insecurity. I couldn’t enter that trade at 17040 as I couldn’t access the account at that time.
      I am working on how to just hold trades longer, little steps at a time.

  24. Not that I’m Scottish but I would vote yes on principle. I believe that power should be devolved to the lowest level. It is irrelevant anyway on the whole. The big key items – economy and foreign policy are decided by Supranationals and the US! So Scotland could leave Union with the rest of the United Kingdom and join a union with the EU and it really wouldn’t make much difference.
    The Better Together campaign is built around tradition and normality but the social relationship between Scotland and the rest of the UK would still exist.

    However I think the NOs will sneak it. YouGov owned by a Tory politician……maybe a double bluff to overstate the yes voters to get the NOs out of their complacency and into the ballot boxes.

    Will result in a relief rally on Friday…..so FTSE needs to head lower for now……to 6650 – 6700 by close on Thursday.

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