Good morning. Hold onto your hats as its today Scotland decides. Going to get quite jumpy I expect as the results start to come through… Yes or No!? If possible, today is one of those days when you just stay on the sidelines and watch the fireworks! Support wise, there is 6782 and 6757, resistance wise 6820 and 6840 are still in the frame. News today is going to be all about the Scotland vote, I wouldn’t be surprised if we see a rise before any of the results start to come out then maybe a wobble later, especially if the Yes camp are showing to be in the lead. Sterling will be the main one effected – if Yes wins, shorting GBPUSD could be pretty lucrative!
Asia Overnight from Bloomberg
Asian stocks outside Japan fell after the Federal Reserve raised its estimates for interest rates. Japan’sTopix (TPX) index jumped toward a six-year high on a weaker yen.
The MSCI Asia Pacific excluding Japan Index lost 0.9 percent to 490.73 as of 11:54 a.m. inHong Kong. The Topix rose 1.1 percent as the yen reached a six-year low against the dollar, boosting the earnings outlook for exporters. The Fed raised by 25 basis points its median estimate for where the federal funds rate will be by the end of 2015, while maintaining a commitment to keep rates near zero for a “considerable time” after bond purchases are completed.
“A weaker yen is a plus for Japanese stocks, while higher bond yields in the U.S. can stoke concern money will be taken away from emerging markets in Asia,” said Masaaki Yamaguchi, equity market strategist at Nomura Holdings Inc., Japan’s biggest brokerage by market value. “But I don’t think we will see a chaotic selloff because China has tried to stabilize the situation with policy tools.”
Treasuries declined and U.S. stocks gave up early gains yesterday as investors focused on an increase in the Fed’s interest-rate projections for next year. Futures on the Standard & Poor’s 500 Index were little changed today after the underlying equity gauge rose 0.1 percent yesterday.
Regional Gauges
The MSCI Asia Pacific Index (MXAP), which includes Japan, fell 0.4 percent, pushed down by the yen’s slump, which cuts the value of Japanese shares in the dollar-denominated measure.
South Korea’s Kospi index declined 0.7 percent and Australia’s S&P/ASX 200 Index slipped 0.4 percent. New Zealand’s NZX 50 Index rose 0.2 percent as a report showed the nation’s economy expanded 0.7 percent in the second quarter from the previous three months, exceeding the 0.6 percent median estimate of economists surveyed by Bloomberg.
Asian stocks rose yesterday for the first time in 10 days as China’s central bank joined its European counterpart in boosting liquidity. The move by the People’s Bank of China to provide 500 billion yuan ($81 billion) of three-month funds to the nation’s five largest banks will help overcome any pre-holiday cash crunch, though is unlikely to boost gross domestic product, according to economists at banks including Barclays Plc.
FTSE Outlook
To be frank its not really an ideal trading day today – it could do anything. That said, I have plotted the arrows for an early rise during the morning (IG are still pricing a No victory 80v20) and the some of the bookies have paid out already on a No vote win. The pivot is around 6782 again, and we have the bottom of the 20 day Bianca at 6763, and the 10 day at 6757 – maybe a small long at around that area if it were to get that low this morning could be fruitful. The moving averages on the 30minute are still bullish at the moment (10 minute too), which is why I went for an initial rise from this 6795 area.
Resistance isstill 6820, 6835 and 6840 – the latter is the top of the 30minute oblique line, and the top of a declining channel, so worth a small short around here, especially if it hits just as results start to come through and show Yes in the lead.
Going to be a jumpy day!!