Quote from Nick on 1st February 2019, 10:49 am

1st February 2019

Donald Trump will meet Chinese president Xi Jinping in the "near future" to help strike a trade deal as March's tariffs deadline looms. The US president revealed on Twitter that the two leaders will meet to "discuss and agree on some of the long standing and more difficult points" of their trade dispute.

He insisted the high-level talks taking place in Washington in recent days were "going well with good intent and spirit on both sides". Mr Trump vowed to strike a "complete deal" that leaves "nothing unresolved". Tariffs on $200bn of Chinese goods will be hiked automatically on March 2 and reports have suggested that major sticking points remain between the two sides.

Italy is back in recession for the third time in a decade and the fifth since the turn of the millenium. One of the world's top 10 economies, it is also core to the eurozone and has the most government debt on the continent.

Elsewhere, the FTSE 100 flirted with a two-month high, extending its climb to a third day on dovish signals from the Federal Reserve and cooling trade tensions. Supported by strong rises for Smirnoff maker Diageo and oil major Royal Dutch Shell, the FTSE 100 advanced 0.4pc, a third day of gains.

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FTSE 100 Trading Signals, Forecast and Prediction

We have the NFP (Non Farm Payroll) out at 1330 today in the USA and that is something that can lead to a bit of volatility, with the forecast being 165k. It is also the start of the month so we may well see an initial kick up at the open as the new money comes in for investment.

[caption id="attachment_14551" align="aligncenter" width="821"] FTSE 100 Trading Signals, Forecast and Prediction[/caption]

If we do get a rise first thing I am looking at resistance at the 6995 level, similar to yesterday, and then 7022 above that. We have the top of the 20 day Raff here as well as daily resistance, and considering the bulls have tried so hard to reach the 6990 area yesterday (and were rebuffed) I am sort of expecting them to push for the 7000 area once again. If they were to push above 7022 then I think we can expect R3 at 7060 and possibly the top of the 20 day Raff channel at 7100. Above this then a revisit to 7200 and higher looks distinctly possible and the  drop to 6500 in December was just a big flushing exercise, with the break below 6800 more recently a bear trap.

On the bearish side, if the 6995 holds as initial resistance I am looking at a drop down to the 6930 area where we have the fib level. Should the bears break below this then the longer time frame supports are in play - on the 2 hour chart I am looking at 6884 for the coral, and on the daily we have the 25ema at 6870. As such a long around this area is probably worth taking if we did drop that low, probably with a stop just below the 6850 level.

So, fairly simple plan today, bit more cautious as its NFP Friday, but looking at 6995 and 7022 as resistance and 6930 as support with 6880 below that. Have a great weekend.

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