6830, 6811 Support, 6857, 6869 Resistance

Good morning. Nice short yesterday that did take a while to get going but delivered in the end. Even got a little bounce off the pivot as well. Turned a bit more bearish later on, but overnight has bounced back – though the S&P has stayed daily static the whole time, dropping off that 2007 level but only as far as 2003 this morning. Does look like its being supported but could easily put a trip in to 1980 by mid September, though 2006 is resistance again today. FTSE has 6869 and looks like we could get a rise and dip scenario today.

Asia Overnight from Bloomberg
Asian stocks climbed, the yen touched an almost eight-month low and bonds in the region tracked Treasuries lower amid signs of strength in the U.S. economy. Chinese shares jumped after gauges of services activity rebounded, while crude oil rallied.

The MSCI Asia Pacific Index rose 0.5 percent by 2:04 p.m. in Tokyo, asHong Kong’s Hang Seng Indexadvanced 1.5 percent. Standard & Poor’s 500 Index futures were little changed after the benchmark U.S. index slipped 0.1 percent from a record. The yen fluctuated after falling to as low as 105.31 per dollar, boosting Japanese shares. Yields on 10-year Australian debt added nine basis points. Oil in New York rebounded 0.3 percent and gold climbed from the lowest level since June.

U.S. factory output grew in August at the fastest pace in three years, underlining the economy’s divergence with Europe and China, where gauges of manufacturing this week dropped more than analysts projected. A private gauge of non-manufacturing activity in China jumped the most on record after its lowest-ever reading last month. Japan and the euro area see service-industry data today, before the European Central Bank and the Bank of Japan update monetary policy tomorrow amid speculation over the outlook for stimulus.

“A strong U.S. economy is good for Asia, particularly the exporters,” Timothy Radford, a strategist at Rivkin Securities in Sydney, said by phone. “The rally in Japanese equities can be sustained as the the yen continues to weaken. There are still concerns about the Chinese economy. If we do see further weakness, we’d expect the government to implement more stimulus.”

Japan Gains
The Hang Seng Index climbed back above 25,000 and a measure of Chinese companies listed in the city advanced 2.1 percent. The Shanghai Composite Index added 0.6 percent and is heading for its highestclose since June last year.

An official non-manufacturing purchasing managers’ index for China’s services sector rose to 54.4 for August today, from 54.2 in July, while a similar gauge from HSBC Holdings Plc and Markit Economics jumped to 54.1 from 50. Factory gauges released Sept. 1 indicated Chinese manufacturing growth is slowing.

Rate Outlook
The U.S. manufacturing data bolstered speculation that the Fed may bring forward its timeline for higher U.S. interest rates. Reports last week showed U.S. GDP expanded more than previously forecast in the second quarter, propelled by the biggest gain in business investment in more than two years. A Labor Department report Sept. 5 will show the number of workers added to payrolls rose by more than 200,000 in August for a seventh straight month, according to a Bloomberg survey of economists.

Ukraine Conflict
Russia, engaged in a conflict with Ukraine over its support for separatists in the former Soviet republic’s east, is the world’s No. 1 producer of palladium and the biggest energy exporter globally.

U.S. President Barack Obama is heading to eastern Europe to reassure NATO members of their security amid criticism from Russia over the U.S. approach to the tensions in Ukraine. Russian Foreign Minister Sergei Lavrov said Ukraine’s allies were stoking the five-month-old tussle and should back peace talks, while President Vladimir Putin sought to quell concern over remarks that his army could “take Kiev” in a matter of weeks. Ukraine has been strengthening its defenses.

FTSE Outlook

FTSE 100 Prediction
FTSE 100 Prediction

Todays pivot is 6830 and with the overnight rise I think we will see slightly more bullish start. We have significant resistance at the 6860/6869 area for today as we have the top of the 30 minute channel there and also the top of the 10 day Bianca, the 20 day Raff and and the 10 day Raff at 6871. As such that area looks a good shorting spot. Initially the bulls will need to break through 6837 to push to 6857 and then the 6867 area, though if the pivot breaks the next support is 6811 – the bottom of the 10 day Raff. If 6810 breaks then we could be heading lower quite quickly, 6750 is possibly later this week.


    1. Looks like this b. doesn’t want to fall. I am out +1, I’m not suicidal to go against such a strong trend picking the tops. bad old habits. moved on.

  1. Not liking this today 🙁
    I cannot see a valid reason for the ftse to be at this level and stay there. Can anyone shed light on why the markets won’t take some profits and see it fall?

  2. Most likely due too Ukraine and Russia agreeing a cease fire… Strange only a few days ago Russia according to NATO and Ukraine were going war.. Would love too see Putin ig account this morning lol

  3. I agree the ceasefire would cause the rise, but it can’t see that sustaining new highs, but it’s definitely choppy. Not a good day for me and it’s only 10am

  4. Nick’s chart today is hilarious… I placed a small short at 6885 with stop at 6900. Got hit.
    My thinking now, is that FTSE may be starting to do the same pattern from last year, like the one I showed in Twitter on my chart. Thought that would be only after September. 6xxx could be thing of the past. We may be headed finally to 7xxxx
    My longs were closed yesterday, with all these uncertainty with Ukraine and September.

    1. Why is it hilarious? It looked like it would rise from the off which is did. Predicitng a ceasefire announcement is pretty impossible, and thats the only reason it busted the resistance.

  5. Today DOW & S&P Look so overbot that I havr gone short 6898. thid is not A “NOTS” trade. This is my normal analysid trade. I am expecting it to break yesterdays low and I see as the high had been set. The BULL run is over. Repeat I am taking a Normal trade. This is not a NOTS trade

    1. this is a trade i’ve taken earlier but didn’t hold in the end, unfortunately, so actually that sounds like a good trade. however be cautious of possible uptrusts.

  6. PMS
    Not sure what you are saying. Sre you expecting the market to go higher??
    Can you put your chart here.
    Because as far as the market is concerned the bull market is kaput.

  7. Ukraine is out of the equation.
    Left with terrorism, that could appeared like any other natural catastrophe (earthquake, meteor impact…you name it)
    In the economic front…well, we have tomorrow some big decisions. Today the markets are happy with Ukraine with a small taste of tomorrow’s Draghi speech.
    If he goes for QE, than this markets will be unstoppable to the upside, if not, that the trend is up the same, until some rate hikes in UK will make some sell pressure in the short term, but not affecting the overall trend

  8. HEY PMS
    putin,s spokeman says putin & poroshenko did not agree on ceasefire. This was a false rumor

  9. Ahahahah #Putin spokesman now saying that Russian President does back the idea of a immediate ceasefire in Ukraine…. the plot thickens!

  10. US will ignore all this rumour and get on with the selling which started yesterday . So i am expecting a good old sell off. Yesterdays lows will be taken out. Pls remember i am in a “Technical Analysis Trade ” – i will refer to this as TAT trade. This is opposite to the NOTS – Nicks Opposite Trading Strategy.

    1. yesterday’s sell was just a push for longs. it bounced off the level of 28 august, may break up or down any time. possibly up.

    1. As I mentioned, I believe in that pattern. The timing for that is more difficult to predict. My only wish, was not to had closed my longs at 6845 yesterday and the 6806 was not hit in trading hours, leaving me with no position open at that level.

      1. I made 3 mistakes this year, so far.
        1st- Selling at 1898 on SPX, before the big break in that holiday bank in US with EU elections. SPX gone to 1990 in next weeks.
        2st – Not buying at 1900 in that early morning last sell off
        3rd – The mention above sell yesterday. My initial target was 6900.

  11. 50/50 at the moment. Still think the bulls will not give up that easy, another rise for double top and drop? wish wish.

  12. I’m still wishing for a ftse drop to recover some losses 🙁
    But I’ll wait and see, I still think ftse is overvalued at this level, will need to see if a dow sell off sparks a drop…..

    1. Remember always. Being short is not the same as being long. The losses could be indefinitely forever.
      Going long is different. The losses are limited.
      longs also, but not so important.

      1. Don’t understand why you favor longs over shorts? I think they are both equal in their right, however with shorts you need to be more careful as they drop faster than longs rise. Otherwise, no difference. Is it because now the overall trend is long, that’s why you favor longs? But trend can be reversed and shorts could be dominant.

        1. Yes, that’s why…the timing :
          1st you need to be quick in closing positions.
          2nd trading in a bear market could be hell, even for shorts.

  13. PMS – totally agree with you. Shorts always need a stop.
    One thing I can never work out is why I always lose money on my short trades, the biggest losses I’ve had statistically have been with shorts.

    1. That’s why I rarely go short. You need to think a lot on it and start go long more often, when you see a dip, instead of when you see a top

  14. I think we have more short term speculators on the short side, than on the long side. That’s another reason…causing an extra difficulty on that timing

  15. My timing has been well out this morning 🙁
    However took a second short at the top which has clawed back some losses but I exited too early – another problem of mine is not letting profits run long enough, though I’m sure that’s a problem many have not just me!

  16. I still have my long term position in EDP.LS stock, being the best performers these year at PSI20 Euronext. More than 35% this year adding to those big dividends. Bought last year. Now at 3.63 and 4 will be it’s target in the short term.

    1. Also have a smaller stake at EDPR.LS. That have a target around 7,60, with that perfect V-Bottom with extension, that broke up recently at 4,9+-.
      5,50 now

  17. Buffet last year lost the stake for the Chinese. He was very interesting in EDP.LS.
    China Three Gorges won.

  18. So SPX heading to 2050 ?
    I still think mid September will have a pullback.
    The last leg up that I predict a couple days ago, is doing it’s work.
    But was not that confident…with those readings in these website + FTSE behavior in the overall sentiment. So 6845 thought as a top for the short term, with another pullback

  19. Rate hike means the economy is improving, so that’s good for the overall markets in the longer term

  20. Ever think it’s days like this wher all are bullish means we are very close to drops?

    Most articles online calling massive all term highs….

    1. When I see this big moves in early morning and heading to afternoon with that stall in the highs, without any pullback, I always think that we left the lows yesterday and will not see for quite sometime.
      THis is always frustrating for any who wants to go long and desperate for the bears

  21. Have a look at S&P & DOW. Massive bear flag. In all time frame. A knee jerk reaction today. US open will see the last up move, if it occurs at all. Then the start of the continuation move from yesterday will begin

      1. I was waiting for a short signal, but there’s no any. Should have tried longs instead. Now waiting US open.

  22. Have another short waitinh at 6910 & 6917. Douby very much it will get hit. So i have to satisgy myselfvwith the one i shorted earlier at 6898

  23. So us opened at all time highs 🙂 good sign;-) time to short is what us punters are thinking=-O

  24. PMS
    Yesterdays high on S&P is only 1 Point away. Once it doea that we will get our move lower. Below yestetdays Low.

    1. Hope so. I need that September pullback as Javed predicted, so I can start to build again some long positions.

  25. Fuf, done my short scalp on Dow +34 points, 17152.5-17118.5. Finished for today. Won’t wait for a pull back. 🙂

  26. Another 5 points on the S&P & it will have crossed yesterdays lows.
    The highs for the S&P has been set

  27. Oh well, you can’t take them all. Another nice entry after 50% pull back gone. 17125 at 16.03. I did look at it and set a tech entry point for future reference and walked away as I was busy. It would bag another 30 points. But never mind that.
    It should eventually push to 17070 today.

  28. Hey guys, I’m going to short again tomorrow at 6885 with a wider stop at 6951.
    This markets need to sell off.

      1. Thought you were joking….couldn’t be sure though. I got out of my mess in the end with some shorts on both ftse and Dow which brought me back into profit overall for the day. I don’t like leaving my positions overnight especially if I feel I messed up in the first place. It was a small profit in the end, but it was still a profit and I guess that’s what counts after a few horrible trades a couple of months back (being stupid really!) put severe pressure on my account! Good luck for tommorow let’s see what joys it brings 🙂

  29. PMS
    This statement may come to haunt you for the next 3 weeks

    @PMSInvestor says:
    September 3, 2014 at 9:21 pm
    Hey guys, I’m going to short again tomorrow at 6885 with a wider stop at 6951.
    This markets need to sell off

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