FTSE breaks 7200 | 7222 support | 7250 resistance | US labor data positive

9th January 2017

FTSE 100 Support 7224 7222 7214 7213 7208 7185 7180
FTSE 100 Resistance 7248 7253 7256 7282 7285 7304

Good morning, I hope you had a good weekend. Was away on Friday and just watching the markets from a distance but saw that the FTSE has finally managed to break and hold above the 7200 level that its been trying so hard to do so far this year. The dip down to 7180 got bought up pretty well after the NFP results. The question will be how long it will continue setting new closing highs, especially as the daily RSI is at 85 now. As you know I was watching for 7250 from last year and that is the top of the 2 Bianca channels for today so will be interesting to see what it does at this level and if we get a bit of a pull back from around here. I still have a decent swing long entry around 7065 though so its not all doom and gloom. The Dow hasn’t broken 20000 yet either though, testing 19999.8 on Friday.

FTSE 100 Outlook and Prediction

For today I am thinking that we will get a bit more bull to test the 7250 level where we have the top of the 2 Bianca channels. The 10 day is 7248 and the 20 day is 7253 so a short round this area is worth a go I feel. It certainly all looks bullish to start with, as we have a positive 30min chart, a positive 2 hour chart and the daily trends are still up.The 2 hour chart is showing support at the 7222 level, which is also support on the 30min, so a long around here is also worth a go. You can see from how narrow the Bianca channels are that the range has been fairly tight while we have moved up which is why that long and short level is pretty close. The daily RSI at 85 is a little bit of concern as to how much higher we will go on this leg, though it can of course stay above 70 (overbought) for quite a while before actually turning down so not an entry signal in itself.

I went for an initial little dip off R1 to start with, down to that 7222 level and then a bounce to the 7250 area resistance. The ASX200 had a fairly positive session too today, with a rise then a dip so we might well follow a similar pattern.
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