7550 looming | Trump on the ropes | not a bear in sight!

17th May 2017

Not very much of a bear Tuesday! Each resistance level – 7474 and 7504 – got a tiny reaction of 5 to 10 points to the downside and then the bulls powered through. The only market that seemed to behave normally was the S&P – dropping off R1 at 2404 and declining steadily as growing concerns weighed on risk appetite in the US over the turmoil surrounding Trump. Gold rose again steadily, now at 1243, and the indicators are there for it to be a bit risk off on indices so its a bit strange how the FTSE 100 keeps pushing on. After rising to 7530 I expected the top of the 10 day Raff channel to be hit at 7550 but it decides to stall below that. This rise has unfortunately hurt a lot of bears, and lots of bulls have also missed out as the price never drops back to a support level. Certainly quite strange and it will be pretty ironic if we have the first red daily candle and a negative day on the day that we have a 20 point dividend (don’t forget this later as its likely to see some buying start around 3pm).

FTSE 100 Outlook and Prediction

Daily FTSE 100 Trend Channels
Daily FTSE 100 Trend Channels

It will be quite amusing in a funny sort of way if today sees the first red daily candle when we have a 20 point divi and everyone is expecting it to be bullish. Has the FTSE 100 annihilated enough shorters now with that rise to 7530? Maybe not as 87% of IG clients are still short so it might want to stop out a few more yet.

The US futures prices have declined as the turmoil surrounding President Trump continues. The latest is that Trump ‘asked Comey to drop Flynn investigation’ which has weighed on S&P and US futures. As mentioned above gold continues to rise as well so there are still signs that markets should be weaker.

There is resistance at 7550 that looks good for short entry (possibly, maybe, will it, wont it) and 7515 just below that. Support wise, 7450 looks like a level where the divi hunters might well start showing up – this is the last of the larger dividends for a while so it more than likely to see a kick up, usually starting about 3pm these days.

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100 Comments

  2. FTSE so strong, seems its ignoring anything and doing its own thing… It’s so different when in plunged down some 200 points last month..

    1. 84% already short on IG for example = Everyone just sitting on their hands and lot’s of people waiting to buy.

  5. I am pleased to announce on behalf of the bears that you are looking at the very top of the bill market that started in 2009. So close to the sun, the wings of wax start to melt and then….. 😉

  7. Morning Market Warriers :0)…. I’m not sure if I’m still welcome on here now :0)…. I’ve defected to the long side :0)….. Closed my third short from 30 yday after 2 losses at 7498…..went long this morning medium size at 94.4 and exited at 19.8 for a tidy wedge :0)….. Presently long Dow from 855 and Ftse from 25.2 combined medium again :0)

        1. Mr Pump is at the top of my xmas card list and I might get him a bottle of Gin in case he runs out…..he gets through a few cases he does :0) probably goin to need a liver transplant at some point en all :0)

  8. Closed my S&P, Dax and Dow shorts.

    Took the opportunity to go long heavy this morning to cover divi. Will then add to shorts if it gets around 7540.

    I don’t think this going to crash yet if only for the reason we are all expecting it and the price makers know that!

  9. Question to all those on heavy FTSE shorts. ???

    How are you managing the 20pt divi, last thing you want is to buy last minute then be stuck at the top with buys. Or are you just taking the hit? But at £20 a point that’s a lot.

    1. I am taking the hit. It’s £20 for every 1 position. So if you are short £5pp then the divi is £100.
      Are you new to this or am I missing something?
      Compare that with your target. Can’t see how you will loose much when you meet the target

    2. They say it’s a zero sum game, but in reality you usually see it drop and quickly cover the gap – which really peeves me.

      1. Didn’t happen on dow last night. There is a gap which will be filled on the upward retrace from circa 20000.

      1. My crystal ball says ” that’s right anstel get yourself back long for a while longer “…….. :0)

  11. Hey Icarus……have a look at “Elliot wave forcast.com” on the net…..May 17th..Ftse … I think your 6950 is a bit optimistic at the moment…… .? See what you think? I’m interested in your take on it……cheers …

  12. That’s a lower timeframe chart. And their assumption is we are in a bill market. I look at the daily weekly and monthly. We completed a 5 wave sequence on daily and have completed. The retrace up is wave B of weekly and wave A of monthly. What’s important is to understand which wave we are in in each of the 3 timeframes.

    1. Sorry i mean wave A of monthly will complete at 6950. If we are a few points off I am not worried. Key is a 560 point drop from the top making a new lower low on the weekly.

    2. Thanks Icarus I will have another look at it while I’m waiting for my longs to hopefully give me some blue…it’s not easy goin long at the ATH but I can’t see the button pressers letting the world and his dog ,who are short, make a load of money out of some sharp declines……talking about dogs I’m off out to take gromit for a walk…..catch you all later and good luck all….

    3. All I can say is if it goes higher it will only make me more confident in the bear case. And will add to my position. In any case we will see the 560 point drop from the very top by the end of may.
      Let’s call this one the icarus trade!

      1. Hey Icarus I think your probably right but in the meantime I’d rather be long making some money and with the trend,….as tmfp used to say “it’s not broken,till it’s broken” I hope we all make some money :0)….. It’s all about the timing really I reckon….GL buddy…

  13. I’m thinking at some point in the not to distant future cable will sell off and push Ftse higher…..that’s my take on it…

    1. I was thinking the same Anstel, although the GBP and Ftse dont see as correlated in recent days ?

      1. I got a phone call from the bankers asking if I could help out with a bit of buying as they all have a bad hangover from yesterday :0) mind you i gave them a chunky invoice for my services :0)

          1. I can almost feel Icarus willing it down :0) stop it will you,and Si your another possible culprit :0)

          3. I closed one short, still have another underwater from 7493, opened last night when the world was thinking Trump would be impeached.

          5. Nice one Si I’m glad you have done well out of the yellow metal :0) after some of the pain you took on the Ftse last year ….

          1. Come on 7540 :0) theres a juicy dividend you know,be a shame not to buy the Ftse while it’s cheap :0)

      1. I’m like, even if it’s 0.00001% red, I need to see blue before I close it. Must get out of that habit.

        1. Yes Si it’s really important to be able to take losses….admit your wrong and get out and re- evaluate your next trade…

  18. Can’t believe I’m saying this – Long 7497.

    Also running a FTSE future for the divi run.

  20. I plan to pull most longs at 15:30…tend to see a drop most divi days at this point…of course it depends on the next hour

    2. I think Div already finished and damage already done for those on longs. To bounce 60 points on FTSE is a big business, it won’t happen today.

    3. I wouldn’t personally hold long just for the sake of some divi if it goes the wrong way. Divi is a bait.

  25. As quoted as saying 10th May

    “I think markets finally waking up to the fact everything isn’t as rosy as it seems. And of course Trump…”

    Isn’t it frustrating when markets aren’t as quick as you so you then get stuck on the wrong side of your own views?!

    I think you’ve got to be a little thick when you trade, most of the time you need to go against whats logical and whats going on in the world and just jump on board with whatever garbage the markets are fed to prompt them up.

    Based on the current climate across the whole planet (economically and politically) what right do markets have to continually be hitting all time highs?! Bonkers.

    Anyway, seems to be some sensible people in the markets finally.

  28. Only positive now is that I will cash in on the divi and it may and I mean may get wash out if this thing retraces up tonight????

    Lot of ifs

      1. De de de de de de :0) put some sausages under the grill I reckon while I’m waiting……might have a couple of eggs with it …:0)

  32. Closed most of FTSE longs

    Closed Dow long for 30pt, dropped and so re added at 735

    Cheeky short on oil for retrace. Tight stop

    Faired ok out of the divi..scalping left right and centre but still here

  33. And it was “amusing in a funny sort of way” quoting Nick from above, it is a red candle indeed.

  36. Icarus you mentioned a Dow divi today, yesterday’s. any idea what the pt drop is.

  37. Well done Icarus you called it right so far…:0) looks like the dogs on a diet :0)

    1. Mind you I think it’s just an unplanned diversion……still think it’s goin up after a bit of tree shakin :0)

      1. And at least I get a decent divi as a consolation prize…..not had a divi for a long time :0)

  39. Nothing is unplanned when it comes to the markets my friend. Let me give you a clue. Take the daily chart and remove the gap you will find that we are technically at 7375 now.
    Similarly, shift the right shoulder on the dow chart and the 20600 you see is actually 20200. The gap is nothing but short orders.

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