Good morning. Yesterday didn’t quite hit the long order level at 6637 – missed by one but we did still get the dip and rise, with the predictable stall round the 6670 area, just managing an overnight high at the other resistance level 6682, and have dropped back a little. Not particularly bearish, so might get another push high. I still think its not going to drop too much this week to lure in the ISA retail investors (#cynical). US ADP news came in at 191k versus 195k expected, so not too bad and probably means NFP on friday can be along the same lines – just a small undershoot. Bold statement there so will find out tomorrow how far wide of the mark that is!
Asia Overnight from Bloomberg
Asian stocks rose for a seventh day in the longest rally this year, as the Japanese yen reached a two-month low and China’s government announced stimulus policies. Copper and oil fell.
The MSCI Asia Pacific Index added 0.3 percent by 11:43 a.m. in Hong Kong, as Japan’s Topix index gained 0.8 percent. Standard & Poor’s 500 Index (SPX) futures were little changed after the gauge climbed a fourth day, extending its record. The yen weakened 0.2 percent to 104.07 per dollar, while copper dropped 0.8 percent and oil slid 0.2 percent.
China’s government will sell 150 billion yuan($24 billion) of bonds this year to fund railways for less-developed regions and extend preferential taxes to more small companies, the State Council said in a statement yesterday. Weekly U.S. jobless claims are due as investors weigh private data showing an increase in employment last month. The European Central Bank will probably keep interest rates at a record low today.
“We are starting to see more positive talk from officials in terms of the potential for stimulus” in China, said Angus Gluskie, managing director at White Funds Management in Sydney, who helps oversee about $550 million. “You have European and U.S. economies that continue to recover after particularly poor conditions a few years ago. Overall, employment and general economic activity continue to move up.”
U.S. employers probably added 200,000 workers to nonfarm payrolls in March, the biggest increase since November, according to the median of 88 economists’ estimates compiled by Bloomberg before tomorrow’s Labor Department report. ADP Research Institute said yesterday that payrolls rose by 191,000 workers last month, up from a 178,000 gain in February which was stronger than first projected.
FTSE Outlook
Same again today then? Dip to the pivot at 6657 then rise? With the overnight test of the 82 level which was resistance based on yesterdays analysis, a test again of that and break would reach 6695 (top of the Bianca 20 day) and possibly 6715. Should the pivot break though then 6648 would be the next immediate support area then 6618.
With NFP out tomorrow I think we will have a fairly sluggish day today (famous last words) with a slow drift up towards the 6700 area, probably after the initial dip. Yesterdays close was 6659 as well so we may see a little gap close to that level (and the pivot area). Bear in mind I try to be as exact as possible with the entry figures below for the trades and sometimes they are pretty accurate (scarily so sometimes) but just use a bit of poetic license when it nears the area mentioned and enter around that area – also allow for the spread on your platform (and slight variation in prices).