6866, 6846 Support, 6892,6899, 6936 Resistance

Good morning. Well yesterdays started well with the long gaining some points, hit resistance, go short and then 10 minute later a ceasefire gets announced! That was a bit of a kick in the teeth! Anyway, needless to say, the short got stopped out. Once the days starts being sentiment or news driven rather than technical I tend to stand aside and leave it to its own devices – better to stand aside and come back the next day I find. The bulls were frothing there to get the all time highs at 6930, but fell short at 6898, dipping back to 6860 at the close. The FTSE closed just below 6875, ideally for the bulls it would have closed just above. The US wasn’t quite as exuberant yesterday, after the initial excitement wore off Apple weighed things down and the S&P is back below 2000 as I wrote this. ECB announcement today to watch – will they announce QE? Doubt it.

Asia Overnight from Bloomberg
Asian stocks fell, with the regional index retreating from a one-month high, while emerging-market currencies climbed as central banks from Japan, Europe and England decide monetary policy. Samsung (005930)Electronics Co. rose after product releases, and oil retreated.

The MSCI Asia Pacific Index slipped 0.2 percent by 12:21 p.m. in Tokyo, as five stocks fell for every three that advanced after the gauge’s highest close since July 30. Samsung rose for the first time in five days. Nasdaq 100 Index futures were little changed after Apple Inc. (AAPL) led a 0.6 percent drop in the U.S. technology gauge in New York. The South Korean won and Malaysia’s ringgit strengthened 0.2 percent against the dollar. Crude oil fell in New York and London after surging yesterday.

The Bank of Japan left its record stimulus unchanged, while the European Central Bank and Bank of England will announce their monetary-policy decisions later today. Samsung’s release of two new Galaxy Note phones helped fuel Apple’s steepest drop since January, amid concerns over account security. Ukraine and Russia made differing statements about a cease-fire in their conflict.

“There are a couple of exogenous shocks that could trigger the market to break out of its comfort zone,” Toby Lawson, head of futures, options and cash equities trading for Asia-Pacific at Newedge Group SA in Sydney, said by phone. “While investors are looking at geopolitical risks in Ukraine and Iraq, there’s a sense of calm in the markets as the U.S. economic data is strong. There’s expectation that the European Central Bank will provide some stimulus as Europe in general seems to be in a deflationary situation.”

Jackson Hole
ECB chief Mario Draghi told fellow central bankers at Jackson Hole Aug. 22 that policy makers will use “all the available instruments needed to ensure price stability.”

Gauges of euro-region manufacturing and services industries unexpectedly fell this week, underscoring concerns over the 18-nation economy. The ECB cut key rates in June, pushing the deposit rate below zero, and initiated a lending program for banks in a bid to stoke price growth.

BOJ Governor Haruhiko Kuroda said in Jackson Hole that central bankers should use any and all means to ward off deflation.

Ukraine Confusion
Ukrainian President Petro Poroshenko said yesterday that he’d hammered out a deal with Vladimir Putin, Russia’s president. He later removed the word “permanent” from his cease-fire statement and Putin’s spokesman said there had been no deal.

Putin called for an end to the rebels’ offensive in the former Soviet republic’s east and urged the withdrawal of the Ukrainian military from residential areas as part of a seven-point proposal presented yesterday in Ulaanbaatar, Mongolia. Putin’s spokesman Dmitry Peskov said that while the two leaders mostly agreed on steps needed for a truce, Russia can’t reach such an accord as it’s not party to the conflict.

Ukrainian Prime Minister Arseniy Yatsenyuk dismissed Putin’s peace plan as “window dressing for the international community ahead of the NATO summit” and a ploy to duck sanctions. Putin’s “true plan is to ruin Ukraine and restore the Soviet Union,” Yatsenyuk said in an e-mailed statement.

Beige Book
The Federal Reserve said yesterday that the U.S. economy continued to expand during the summer, with none of the country’s regions experiencing a shift in the pace of growth.

Trends in employment, wages and prices were little changed during the July-August period, according to the Beige Book survey, which is based on reports from the 12 regional banks in the Fed system. U.S. policy makers meet Sept. 16-17. Data on factory orders showed a 10.5 percent expansion for July.

The U.S. economy grew more than previously forecast in the second quarter, propelled by the biggest gain in business investment in more than two years, the Commerce Department reported last month. A Labor Department report Sept. 5 will show payrolls rose by more than 200,000 in August for a seventh straight month, a Bloomberg survey of economists shows.

FTSE Outlook

FTSE 100 Prediction
FTSE 100 Prediction

Its going to be quite news driven today with BoE and ECb announcements so expect bit of chop. However, the daily pivot is 6866 so we have initial support there, with 6846 below that. The S&P looks like it might dip and find support at 1995 today where there is the bottom of the 20 day Raff channel, so if that bounced from there it might tally with a FTSE rise to test 6899 again. Above that then the obvious swing short is 6936 which is the all time high. Initially today I can see a dip to the pivot which sing actually that far away, a long there is worth ago, but I don’t think everyone will be piling in longs at these heady levels – unless Draghi does announce more stimulus. Its a bit confusing with the ceasefire between Russia/Ukraine as well, wight he press release being reworded. I also imagine the ISIS issue will be top of the NATO agenda at the moment – escalating quite quickly at the moment with the West being taunted and the possibility of being brought back into a ME conflict.

93 Comments

  1. In a trade from yesterday 6898 & today from 6885 ( courtesy PMS – who later retracted his prediction )
    This is a TAT trade – but seems to be stuck. I dont really want to close & open a NOTS trade. So still holding

  4. My TAT trade is based on – The S&P High has been set and we are not going to see that again for some time. Reckon S&P heading for 1984 where probably get a slight bounce of 10 pips before it collapses. So this is on the charts – so I wonder what the News catalyst is going to be? I suppose this is probably one example always touted by the chartists at every show – ” the charts tell you before the event” So lets see how accurate they are.

  6. Dow trend flat since August 25, and not giving much away about where to next. 🙂 At the moment favour modest depression of the index over the next 10 days or so.

  7. Hey guys/gals. Not been on here for a while. 80% of positions on IG are short positions! Anyone else tempted on the short swing position, of all waiting for 6900 + ?

  9. Careful with those shorts. Draghi likes to surprise. That could do another BIG bounce.
    In the sidelines

  10. Was looking to buy at 9500 on DAX where the long term ascending trend line is in Prorealtime Daily
    In CFD’s I’ve had drawn this early morning, two long term ascending trend lines from the lows, touching at 9536 (more important with lots of touches) and the other with the two pins touching it, would had touch 9500.
    Was looking to buy at 9500, but only after I realize that 9536 line was more important, when I saw that the 50 ma is at 9541.
    Missed a 100 point move in a couple of minutes.

      2. Another nice rejection trade
        13:38 Wall Street, Daily 17135
        14:19 Wall Street, Daily 7101.5
        +33
        missed a nice exit point at pivot, otherwise a nice trade.

  14. I am still holding both my positions. I am convinced of what i said earlier. S&P has set its highs and we are not going to see this market have a run higher. Dragis .15 to .05 seems like a last ditch effort to speak to the market. But what about ? As if .1% reduction is going to get Industry & Ordinary folks jumping with joy. So is this the catalyst for the turn ….. well hope so.

  15. JIM
    You said ” modest depression on the market ” How far do you see this?
    Also do you see any pressure to go higher?

  18. Handy that just as America finish there’s lol markets my would be on there arse if it were not for central banks & QE ….

  20. Governing council – not unanimous on many issues – Rate lowering or QE – so showing lack of confidence or indecision. Market is not going to like this. So this could be the catalyst . Hpe so – or am I just wishing ……. well we will know soon

  21. And said it here weeks ago… now, how can these markets go down ? I need to enter and was aiming at DAX this morning and missed it by 40 points.
    FTSE as always does little and was not interesting at all in this index, unless I see it at 6500.

  22. ECB is outsourcing decision making – to Blackrock….Not really showing confidence at all. Hope so – lets see

  23. Maybe tomorrow some talks from the FED’s about an early rate hike…this would produce some pressure in the short term.

  24. Notice Draghi’s – lacklusture when answering questions. His usual exhuberance is missing. City is beginning to notice this ???? Or am I trying to fit to my positions? I wonder.

  26. He’s finally said what the real problem is – ” Structural Changes ” required. Political in nature. So his hands are tied.

  27. The sell pressure now will come from US, next couple of days. Beginning tomorrow.

    Write it down. A possible early rate hike and more than expected. Maybe not so drastically… only an early rate hike.

  30. Banks need to reform in Europe and that where the real problem is…. France won’t play ball but never the less QE is now being deployed in Europe so it’s buy buy buy

    1. University of Bristol economist Tony Yates reckons the ABS could actually be more powerful than a quantitative easing programme.

  32. Draghi – is screwed really. Politicians are notplaying ball – esp reducing taxes. Banks are not playing ball – by not lending. So he knows printing Money – is of no use whatsoever. market is sensing this

  33. Another nice rejection trade
    13:38 Wall Street, Daily 17135
    14:19 Wall Street, Daily 7101.5
    +33
    missed a nice exit point at pivot, otherwise a nice trade.
    Why I didn’t hold more? First, there’s no guarantee the US will not open with the spike. Secondly, not guarantee it will break the pivot, and it’s 3:1 to my stop loss.

    1. I wouldn’t be surprised if it dropped today. Looks like US is putting a bull fight. It may support today.

  35. Bobby Draghi say quate ” ECB will buy broad portfolio of covered bonds and asset back securities ”

    Draghi also said ” the QE process will start in October and more detial will be availible after October 2nd meeting “

  37. Out of 6898 position – so only 6885 Short in play. Obviously – looks like I was talking rubbish. Not comfortable placing a NOTS trade though here.

  39. Still beleive that market is going lower and Highs -esp on S&P set already.
    Just broke through yest high. by a pip. Placed another Sell at 6892. Has not been taken

  40. Senu – What made you sell – When you were asking – “anyone long here”
    What have you seen

  45. Senu
    S&P – Sold 2007 – Stop 2018 – £ 25 /pip Target 1985
    Ftse – Sold 6885 – Stop 6915 – £ 10/pip Target 6843
    Ftse – Sold 6992 – Stop 6908 – £ 10/pip

  50. PMS
    It does not matter what market you trade. They will eventually all move in the same direction.

    1. I was just kidding. But you will experience many frustrations for very limited gains on FTSE compared with other indices. Price is always limited and sometimes seems even rigged. And it does not perform the overall markets.

  51. FTSE lags for decades other markets. You believe that it’s still struggling to break and even reach a price made in 1999 at 6950. Unbelievable but true.
    The red coats have their one way of doing things.

  52. The fatal flaw around QE and the purchase of any other “assets” from commercial banks is the naïve assumption that the latter pariahs, in whatever continent, will put their revitalised balance sheets to the greater economic good. Printing money for the use of banks does nothing for the real economy. That money doesn’t just “find its way” into the stock market, it goes straight into it, artificially bolstering demand and boosting the value of bankers’ assets. Politicians need to get a grip, and show who’s boss at the end of the day. 😀

  53. Jim
    I think Draghi Showed that today.
    I think we should send Nigel Farage to sort this out , God forbid
    Better still – Our own ” Boris the Clown “

  54. But technically speaking – The Move Down is written all over the charts.
    S&P – Clear picture. Down to 1985 then a small move up to the 2000 mark
    before a Clear path – Down. So I feel even QE / or anything is going to stop this.
    A very similar pattern is also seen in Ftse – though possibly delayed by a couple of days.

  55. Pms don’t fall in love with the Dax long…. More sanction to announced tomorrow for Russia could see a sell off on dax

  59. S&P short closed. Been in and out. Will add at 2005 if it returns. Ftse short still active but reduced stake. Av 6848

    1. Looks like a lot of people are still thinking that, But I feel that the last gasp by the bulls was yesterday.
      But I am the only bear in a sea of bulls

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