FTSE Prediction | Support 6944, 6915, 6880, 6845 Resistance 6975, 6981, 6988, 6995, 7036, 7063

Good morning. I hope you had a good weekend. Fairly quiet on the news front apart from Greece yet again, with the endgame getting nearer. As deposits flee the financial system, lenders use collateral parked at the Greek central bank to tap more and more emergency liquidity every week. In a worst-case scenario, that lifeline will be maxed out within three weeks, pushing banks toward insolvency, some economists say. I imagine that Greece will be the most dominant story of the week, with the associated volatility that goes with that. Here in the UK, Osbourne has announced a summer budget following their election victory, will be on 8th July.

US & Asia Overnight from Bloomberg
Asian stocks rose for a second day, following gains in U.S. shares as weaker-than-expected economic data spurred bets the Federal Reserve won’t rush to raise interest rates.

The MSCI Asia Pacific Index added 0.1 percent to 153.37 as of 9:06 a.m. in Tokyo after rising 1.4 percent last week. The Standard & Poor’s 500 Index extended a record Friday after data showed an unexpected drop in consumer confidence. Equities rose last week after selling that erased $400 billion from fixed-income markets subsided.

“The size of the decline in consumer confidence is pushing back estimates for a U.S. interest-rate hike to December,” said Shoji Hirakawa, chief equity strategist at Okasan Securities Co. in Tokyo. “That’s beneficial for stock valuations.”

E-mini futures on the Standard & Poor’s 500 Index slid 0.1 percent. Consumer confidence unexpectedly fell in May by the most in more than two years, while factory production stalled in April.

Japan’s Topix index added 0.5 percent. Mitsubishi UFJ Financial Group Inc. plans to buy back more shares and Mizuho Financial Group Inc. is raising its dividend as the nation’s largest lenders increase shareholder returns amid higher profits. Mitsubishi UFJ climbed 1.8 percent and Mizuho rose 1.9 percent.

Australia’s S&P/ASX 200 Index declined 0.2 percent. South Korea’s Kospi index was little changed. New Zealand’s NZX 50 Index gained 0.2 percent.

Greece, Oil
Greek banks are running short on the collateral they need to stay alive, a crisis that could help force Prime Minister Alexis Tsipras’s hand after weeks of brinkmanship with creditors. In a worst-case scenario, that lifeline will be maxed out within three weeks, pushing banks toward insolvency, some economists say. Tsipras said as recently as May 14 that he won’t compromise on any of his key demands.

Oil fell for a third day in New York, its longest losing streak since March, amid concern the market’s rebound to $60 a barrel will encourage production and sustain a global supply glut.

“Given the uncertainties around the bond selloff, the Fed’s eventual move to tightening and Greece, the next few months could remain volatile for shares,” said Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors Ltd., which manages A$160.5 billion ($129 billion). “In anticipation of a correction in bonds and shares we have been running a higher than normal cash allocation and see recent moves as setting up investment opportunities.” [Ref]

FTSE Outlook and Prediction

Todays pivot is initial resistance at 6975, and there are a few others around this level so I wouldn’t be surprised if we get an initial dip to start the week. The moving averages are bearish and the daily trends are down at the moment so the bulls have a bit of a task on their hands to push higher.Of course the Greece situation won’t be helping their case. 6945 is the first line of support, where we have the bottom of that triangle on the 30minute chart you can see below.If they manage to hold this then we could be on for some rises. The S&P is marinating the gains from last week at the moment, with the push to that 2140 looking likely. The PRT lines on the 30min are plotting some rising channels, firstly with support at the 6945, then 6915 below that. Lower support is is at 6880 and 6845 for the bottom of the Bianca trend channels. Resistance today is 6975, 6988 (25ema on the daily here, and with resistance also at 6995, worth a short with a stop just above 7000). Above this then the top of the Bianca channels at 7036 and 7063 are in play. It may well be a brave buy at 6945 but with S1 at 6938 it won’t need a massive stop.