Good morning. Nice short off the 6810 yesterday but wow it took a while to generate those 30 points! I ended up closing at 6780 as the S&P had dipped to its pivot which was holding and as I was expecting a climb on that from that level it was probably going to take the FTSE with it. Which it did and we are now back at 6800 as I write this with the chart looking like having a bullish day ahead. Bull Tuesday back in the mix? Greece worries are receding for the moment, though there is still the spectre of a Grexit at some point down the road. The tin can has had another kicking anyway.
US & Asia Overnight from Bloomberg
Asian stocks rose as a weaker yen buoyed Japanese equities and consumer shares advanced.
The MSCI Asia Pacific Index added 0.2 percent to 144.51 as of 9:01 a.m. in Tokyo. Consumer companies led gains, while energy shares were the worst performers for a second day. Crude oil fell below $50 a barrel on Tuesday, as gold traded near a five-year low.
“This commodities rout is a very big concern,” Michael McCarthy, a chief strategist at CMC Markets in Sydney, said by phone. “There’s risk for a further downside. It looks like the overall global growth outlook is continuing to slow.”
Japan’s Topix index rose 0.5 percent as it resumed trading following a holiday on Monday. The yen traded at 124.35 per dollar, weakening a second day. South Korea’s Kospi index added 0.5 percent. Australia’s S&P/ASX 200 Index increased 0.1 percent. New Zealand’s NZX 50 Index climbed 0.2 percent. Markets in China and Hong Kong have yet to open.
The Shanghai Composite Index climbed for a third day on Monday, rising 0.9 percent after the gauge briefly surpassed the 4,000-point level. A fifth of the market remained frozen.
The Chinese benchmark has rebounded 14 percent since July 8, following a month-long rout that cost shareholders almost $4 trillion, as policy makers introduced a spate of measures to bolster equities. China Securities Finance Corp., a state-backed agency that provides margin finance and liquidity to the market, has as much as 3 trillion yuan ($483 billion) on tap to support stocks, people familiar with the matter said late last week.
E-mini futures on the Standard & Poor’s 500 Index dropped 0.1 percent today. The U.S. equity benchmark index added 0.1 percent on Monday in New York as the Nasdaq Composite Index extended its record.
Greece met a deadline to pay some 6.8 billion euros ($7.4 billion) to creditors Monday, as depositors queued at reopened banks in the first signs of normality after last week’s bailout deal.[Ref]
FTSE Outlook
It all looks bullish at the moment for today (6am), and with support at 6775 any dip to this level looks a good long entry. We have the bottom of the 10 day Bianca there and also the 200ema on the 30min chart. I expect that we will break through the 6810 area which have been the most recent highs, most likely to reach the 6840 area today. I have plotted the arrows fairly bullishly so we may not get a dip down to the 6775 area, but instead just follow that 30min channel upwards, but it will be interesting to see if we (a) dip off 6840, and (b) how far. If it doesn’t dip at all there then we are probably going to have an up trending day. The top of the Bianca levels are worth a watch at 6926 (20day) and 6979 (10day).