Good morning. I had four trades pencilled in for yesterday but only one took, the long at 6770 which ended up running to target at 6804. The price never got quite high enough for any of the 3 shorts to kick in, but the bulls certainly defended the 6770 despite it being tested by the bears for most of the day. Yellen was speaking yesterday and reiterated that the fed will continue to underpin the US Economy. Overnight saw news of improving Chinese export/import numbers. The Dax was the wild one yesterday – bouncing just above the support at 9390 and then running all the way to resistance at 9545, certainly one for the braver traders!
Asia Overnight from Bloomberg
Asian stocks rose, recovering some of yesterday’s largest drop in seven weeks, as Chinese exports and imports unexpectedly climbed and Chair Janet Yellen said the Federal Reserve will continue to support theU.S. economy.
The MSCI Asia Pacific Index gained 0.6 percent to 137.64 as of 10:41 a.m. in Hong Kong, with nine of its 10 industry groups rising. Yellen told U.S. lawmakers the economic stimulus that has fueled global asset gains is still required because employment and inflation are well short of the central bank’s goals. China’s exports and imports unexpectedly rose in April, helping leaders put a floor under a slowdown in the world’s second-biggest economy.
“Primarily we are looking at an improvement” in China trade data, Hao Hong, Hong Kong-based chief China equity strategist at Bocom International Holdings Co., said told Bloomberg TV. “For the time being, we don’t have to worry about tightening liquidity in the economy. The trade surplus is going up in the right direction.”
Regional Gauges
Japan’s Topix index climbed 0.9 percent, with volume 17 percent below its 30-day average for the time of day. Australia’s S&P/ASX 200 Index rose 0.7 percent, maintaining gains after employers in the country hired an extra 14,200 workers in April. South Korea’s Kospi index rose 0.1 percent, while New Zealand’s NZX 50 Index slid 0.3 percent.
Hong Kong’s Hang Seng Index (HSI) climbed 0.7 percent and the Hang Seng China Enterprises Index of mainland shares traded in the city added 1.4 percent. The Shanghai Composite Index rose 0.4 percent. Singapore’s Straits Times Index and Taiwan’s Taiex Index both advanced 0.3 percent.
Chinese exports rose 0.9 percent in April from a year earlier, topping economist forecasts for a decline. Imports grew 0.8 percent.
Futures on the Standard & Poor’s 500 Index fell 0.1 percent today. The U.S. equities benchmark gained 0.6 percent yesterday as optimism that the Fed will continue to support the world’s biggest economy overshadowed a drop in Internet stocks led by Yahoo! Inc. and Groupon Inc.
FTSE Outlook
Well yesterday was the big test of the 6770 support level which held, at least so far. if tested again today I’d class that as the second test (also likely to hold) but then any fort her tests tomorrow onwards will probably break. Similar to yesterday we have resistance at 6816 and 6830, though we also have the channel top on the 30 min chart at 6842 where I have drawn the pink arrow to. Therefore the short at 6830 will need to have the stop slightly above that, and possibly will even be a good place to add to the 6830 short in fact. As such i will probably go half stakes at 6830, and add at 6840. Todays pivot is 6787 so that could act as support on any initial dip, and in fact if we do get those first two arrows, is likely to. Shorts from 6830/6840 will be decent today I think!
As I mentioned yesterday it does feel like the bulls are running out of steam a bit, and I am also mindful of the sell in May mantra that people will be considering at the moment. As such, shorts of the resistance levels should work well today. We nearly saw 6815 yesterday (mid price, excluding the spread) out of hours and have since fallen back to 6800 despite that improved news from China. Usually if the head of the Fed says that they will continue to underpin the economy the bulls go mad, its quite telling that they didn’t yesterday.
I dont lend an awful lot of weight to this but it is worth a glance and that is on IG you get a snap shot of retail traders activity as per the image below. The buys are just edging out the shorts at the moment, and bearing in mind that the market will want to cause pain to the maximum number of participants will want to trap all these longs.
Gone short on dax at 9585 stops at 9659…. And short ftse 6830 no stops on this one
short as well at 6829
Went short at 24 as I wasnt paying attention when it was higher.
How did yesterday pan out for you Marco?
just the 10 points, trouble is I find things work better when I set an order at resistance point and turn off rather than looking
Yeah its too easy to panic/ get over excites watching the tick or 1 minute
especially when your up a load you tend to cash in early
Anybody still holding shorts? Was thinking of building shorts at 6830 and 6840 like Nick but not too sure now!!
Ive got a short open but its just gone the wrong way. Still not at stop though as I set this at just above Nicks high end
Will this get the peak before 12:45 rate decision ?
Marco, u still with the short?
Dax off from its high, FTSE not giving up, anyone expect a spike during decision?
FTSE 78% short – IG Marget insight
Still short on Dax and ftse might before us markets open showing reasonable profit for today
Closed dax only 35 points
dax just made power moves O: just got 60 pips in like 2 seconds what was that about-not complaining though
Nick’s high hit, anyone short @ 40 ?
Order was in – IG didn’t take it
oh sh** !
Short on Dax again 9620
If 16575 breaks then 16600 on
marco, r u still short in FTSE?
yes another crap day sat there at 6830
Just curious to know, anyone long here?
Hi Hash, are u still in sidelines? your view will be much appreciated. Thanks
Dow/daily — Index growth measure picking up again. Recent cycles reasonably regular. Next leg up should see around 16700. Dependent on growth up-cycle developing, etc. 🙂
http://i1348.photobucket.com/albums/p736/jmca01/WallStreetDFB_zps83073b84.png
Thanks Jim. What do u think for today?
Good close above the resistance 🙂 Bull from tomorrow?
marco, me too crappy week 🙁 altogether
I think the machines chasing a overbrought across most indice…. Have added too my ftse short at 6840 my dax is now reduced too 25% of original stake…
Oops that should have been overbrought market
Anyone buying this dip?
Hi Senu – The Dow is pulling back a little at the moment, but I think the underlying short-term trend is positive, so I expect it to keep most of today’s gains at the least, possibly finishing up > 16600. My best guess at the moment. 🙂
Thanks again Jim. I am long FTSE and it is just staying watching the dow fall 🙂
at what level ? The US is just rangebound. Been long at 1875 for quite sometime and my target at 1896 is just too far. It has lack of conviction. With all interest rates and dividend adjustments I’m today at B/E. Yesterday I received a good dividend.
But I wanna see SPX break that 1890 level. <I thought it was today
I’m so frustrated when I see that price bouncing off like a roller-coaster.
It’s just looking like a videogame. They take prices to higher levels, just to sell hard, but then instead of follow trough, they start to buy again. No trend, no conviction, nothing
I am long FTSE @ 6827, booked -1 🙁
Is just me or this site and people are trading less ?
I have only a small position amd just wanna trade again with more conviction but lack of time and markets doing nothing….
Wat the hell of Dow. Choppy.
Anyone make profit. I really need to get in the game. Loss a lots of money. I new only trading last two year loss a lots. Please could some one advice how to play. Like buy the dip? I still short ftse at 6620 n short Dow 16130. Massive loss. When will ftse n Dow drop? Howard make profit. I can afford to loss any more. Please guide n teach…..
Morning anyone short?
Yep, I’m short but it’s a medium term trade – market looks pretty over bought to me at the moment. Monthly chart backs it up. Think it’s likely to come down to 6400ish over the next month – six weeks before picking back up.
Marco you in anything tgis morning?
Belly I am long at the moment from 6821
Long? I only see this going down. How high do you think it will go?
My mistake I was looking at my numbers for yesterday whoops