6830 resistance area today

Good morning. Well that was a bit frustrating, the rise continued yesterday but didn’t dip back to the entry level I had identified so I was wary of hopping on the long, mainly as it had come quite far from the 6696. Hindsight is wonderful but made me regret closing the long at 6770! That said, it struggled at the 6725ish area, where we had the top of the 10 day Raff for yesterday, and todays 10 day Bianca channel top is 6831. If it breaks that 6860 is still likely, though after 2 days of strong rises a little dip is possible. The S&P stalled at the higher resistance level at 1851 and only tested that level the once. Asia levelled off overnight, staying quite flat. It was Bank of America’s turn for results yesterday which were welcomed well, adding 2.3% to the share price.

Bianca Trends
Bianca Trends

Asia Overnight from Bloomberg

Asian stocks swung between gains and losses as financial stocks led declines and Japanese shares pared an earlier advance.

The MSCI Asia Pacific Index added 0.1 percent to 139.43 as of 2:37 p.m. in Tokyo after falling as much as 0.1 percent. Shares earlier gained as much as 0.3 percent followed a global rally that saw the Standard & Poor’s 500 Index climb 0.5 percent to a record and the Stoxx Europe 600 Index jump 1 percent yesterday as the World Bank boosted its global economic growth forecast.

“The market is being sold after rising yesterday and this morning fast, but it’s not that something changed the market’s direction,” said Takuya Takahashi, a senior strategist at Daiwa Securities Group Inc., Japan’s second-largest brokerage. “We don’t see anything that casts a cloud over the U.S. economy or any negative earnings results.”

Futures on the S&P 500 added 0.1 percent today. Bank of America Corp. climbed 2.3 percent to $17.15 yesterday, the highest since May 2010. The second-biggest U.S. lender’s profit more than quadrupled as the company quelled claims tied to defective mortgages.

The Federal Reserve said “moderate” growth across most of the U.S. last month was buoyed by gains in holiday spending by consumers, an improving labor market and strength in manufacturing.

‘Positive’ Outlook

“The economic outlook is positive in most districts, with some reports citing expectations of ‘more of the same’ and some expecting a pickup in growth,” the Fed said yesterday in its Beige Book business survey, based on reports gathered on or before Jan. 6.

International Monetary Fund Managing Director Christine Lagarde said yesterday that momentum in the world economy in the second half of last year should continue in 2014. The Washington-based fund plans to raise its forecast for global growth when it releases a report later this month.

“For the time being, I think the fundamental story is real and strong enough to keep the market going,” said Mikio Kumada, a Hong Kong-based global strategist for LGT Capital Partners. “We just bought more into developed equity markets a few days ago.”

FTSE 100 Prediction
FTSE 100 Prediction

FTSE Outlook

The EMAs on the 30 minute chart are still positive for more bull but we are at some fairly key resistance at 6830, being the top of the 10 day Bianca and there are also a couple of ProTrend lines of resistance at 6830 and 6840 on both the daily and 30 minute charts. That said, I think after the decent rises of the past 2 days a little pull back is possible, probably to the daily pivot area at 6777, and also the bottom of the channel on the 30 minute chart (bottom is at 6785). If the bears were to break that 6780ish area then the 10 day Bianca channel bottom at 6730 is distinctly possible, but I don’t think the bulls will give up these gains that easily, though they might struggle to break this 6830 area today. If they do then the top of the 10 day Raff at 6860 is likely to be hit next.

159 Comments

  13. Nick as you trade FTSE futures, can you tell me what happens to price, for it to narrow to the cash price ?
    My question is :
    Even both following the same direction, if you trade based on the cash charts, the future price cannot follow always the cash and if you have a specific target in the tradable hours 8:00-16:30 to hit in the future, that price can be hit much later in the futures contract.
    So this could not be a good option.

        1. I trade the cash but I use the futures charts, they are best for direction I find. But every trader has their own method, whatever works.

          1. I also follow them, but never trade them. My question is not about that but trading them directly. Price of cash follows the futures but they can vary a couple of points daily in a stealth fashion. So if you are trading the futures based on a cash target, that could be not a good idea

  16. FTSE in daily uptrend, no signs of weakness at the moment, its treading water, waiting for the US markets to show direction…

      1. I have them. To be honest if I close I will be defeated for a long time. So hope for pull back just to reduce my positions. Just to get the stake more manageable so I could short on tops for the same reason – to help to reduce, reduce, reduce. I am not talking of any win here. Just not to lose my pants or something like that. A bit annoyed (softly said) as usually some sort of pullback happens. But this must be some kind of different type of move. Really scared sometimes.

      1. Well the trend is certainly up at the moment, all dips are being bought (some of that is shorts closing of course).

        But we will have a decent pull back at some point, when is the hard part.

        1. Can’t wait for the pullback, midterm off course.
          I have been holding shorts for a while now and it’s killing my equity. I am looking for that mid Feb 6400-6300 (if it ever comes) 🙁

  21. Dow and Dax both showing descending triangles which suggests it is going to drop and take FTSE with it. I am still short (few points loss ath the moment) so I would think that wouldn’t I!

    1. FTSE is staying put for the moment. I would hope you are right off course, cause I am short too 🙂
      If FTSE does not fall with then it means we haven’t seen top yet and another leg up would be in order 🙁

  22. Amazed that the s and p dropping away from 1850 that ftse is still at this level. Should be testing 6800 really. Miners propping it up. Hopefully my short will survive today.

      1. Gosh, I wish. I placed little orders 6740-6760-6780 trio of the full stake (the last available battle with s.l 6900 for this lot) and if one or two would be triggered and pulled down to 6800 that would be marvelous.

  27. Nick,

    Did your view on the yearly analysis you posted change at all?
    I remember a drop to around 6000 on that chart? 🙂

    1. That right, top of the weekly channel is at 7100. There is the all time high around 6950 to break if that was to get hit so would be a stumbling block I imagine.

      1. Cheers 🙂
        Gives me a bit of relief on these shorts I have running…
        Not doing my equity any good. Only good thing is the positive premium for holding them, however small.

          1. Thanks very much 🙂
            I have it slightly higher at around 6300, but then again I am not that experienced…

  31. Just seen that nick think this is going to be a bad year for some company earnings let’s see how they justify these indice levels

    1. Indeed – some share prices have got ahead of themselves. Bottom line is that consumers are still not spending, but still want to reduce debt and build savings.

  32. Google is a good example. It was trading at 800 not so long ago.
    On a really good report the price has shot up by 300 odd. Must be one to short.

  36. To be honest, it doesn’t seem to want to go over 6830 or drop below 6812 – until it breaks one of these seems it is a day to sit on the sidelines. If it breaks south of that Ill add my short and if it goes over Ill close. Not terribly hopeful of either to be honest !

      1. Yes,may be a bit early also, but I am expecting another move up during close like last 2 days . It will be confirmed around 4pm

  41. Would be surprised if this doesn’t go down today … seeing what’s going on with Goldman and Citi !!

    1. The Dow’s downswing, pointed to earlier, is developing. The banks’ results remind the market of what a scurrilous shower they are.

  46. Still got short from 6776, you would think the ftse would move considering DOWs down 100 points. Frustrating, to say the least…

  47. Ahwab I share your frustration. No doubt we will rally after hours if the Dow reverts upwards! Typical!

  50. A doji end of the day. No numbers I wanted. Frustration, bored. That’s the business

  54. Nick,

    No, 6300 as the bottom (swing) for the pullback around mid/end Feb.
    This is for medium term trades…hope that makes sense?

  55. Just received a random email saying “Time to grab the bull by the horns… Why DOW is going to explode this year and could make you extremely rich!” … Signal to short? lol

  56. It looks like this Sell wasn’t massive. Still possibility that it will slide overnight before another bull storm. I wish it only gone to at least 6800 possibly 6770-80 area would be even better.

  57. OMG, Wall Street had 50% retracement. FTSE and DAX are stuck at the ceiling? Does it mean that pull back is actually over and tomorrow another storm?

  60. Zero relationship with US market at present. No real fall when US sold off and now rallying back with it.

    1. Well the US & Dax have recently made all time highs, whereas the FTSE has not, so it’s playing catchup perhaps….?

  61. FTSE 1 hr. — hasn’t strayed much from channel top boundary since yesterday pm. Now getting firm ‘up’ signals so looking for a positive breakout tomorrow.

  62. I am thinking of the classic switch trades and go long which means it must come down tomorrow! Ha! Can the miners still motor on?

  63. .. You’ve gotta hand if to the ftse up nearly 20pts from the close out of hours unbelieveable but true 🙂 looking at 6860 by 9pm … Call the police!

  64. It’s times like these when you question the market! Ftse futures have motored and the Dow or S&P haven’t moved! Feels like it will gap fill tomorrow morning or overnight. I might get cut out tonight though!

    1. I don’t buy this post close FTSE rise for the reasons mentioned. Now sitting at resistance point. Closed my short at 430 at b/e and wouldn’t normally trade out of hours but put short back in at 6827. Just a small one

  65. Well done to longs. Simply ridiculous. Even if Dow takes out 400 again I’m not convinced ftse will go down!

  68. Monthly UK retail sales results out 9.30, US housing starts, production output and Michigan sentiment 13.30-15.00. Don’t forget last trading day in US before Tuesday.

  69. Senu good call! Feel less annoyed now! I know people here say to take emotion out of it but it’s quite hard to not enjoy a gain or despair at a loss.

  71. Will be tomorrow that I will trade before the weekend ? 😀
    Only one trade this week with 2 points gain :S

  75. “Update on Shell. Shares set to open down 6% as company sees quarterly profit significantly below expectations. “

  86. Just gone long on the Dax at 39 with Dow expected to open up around 420 Dax should break through 50 then its up to 861.
    9700 is support for Dax

  87. I think if we were going to sell off it would have happened at open. Seems range bound now, no doubt the futures will spike after hours again.

    1. In CFDS DOW is trading at 16400 right now not 16420. Are you expecting a gap close at open ?

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