11th October 2017
Crucially for the bulls yesterday they managed to break the 7535 resistance level, with only a meagre 10 point drop from the bears from this level. Markets continue to grind higher on non existent volatility, with Asian stocks near decade highs currently. The S&P dropped back from the 2555 level it spiked to on news of Walmart’s $20bn share buy back, and stayed around 2550 for most of the session. The Fed minutes are out today so may give some confirmation for the next rate rise (December?). We also have a 7 point dividend for the FTSE 100 today, so will more than likely see some strength in the closing part of the session as dividend hunters appear. 2 hour support is now at 7542 and it still looks likely we will get that 7600 this week on the FTSE 100.
FTSE 100 Outlook and Prediction
Looking at the 30min chart there are a lot of negative RSI divergence signals showing, along with the daily RSI at 72. However, still it goes higher with minimal reactions at the resistance levels. It certainly looks like we will get the 7600 or slightly higher, level this week, though it will depend on the S&P pulling above the 2550 level. There are amore and more calls for a correction coming through, which probably means a bit higher yet as the swing shorters are feeling the squeeze now.
For today the 2 hour chart has gone bullish again after that rise from 7500 yesterday, and is showing support just below where we are at 7542. With the green 30min coral also here, and the daily pivot at 7532 the bulls could use this level as a spring board for a push up to 7585 where we have a key fib level. Yesterday’s resistance at 7535 will also, in theory, becoming support.
Below the 7532 level then the bears will be keen to get the price back below 7500, but with gold dropping off from the 1290 level and testing the top of the daily channels here, we may see further rises in equities. The S&P is at the bottom of the 10 day Raff channel here at 2548 as well, (Bianca 10day here too), and thus could easily rise from this level.
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