NFP Friday, Support at 5880, rise to 6000?

Support 5891 5885 5871 5836 5794 5760
Resistance 5923 5951 6002 6008 6096

Good morning.
Market Summary for Thursday
The main focus today was the drop in the US dollar which boosted commodity prices and therefore gave a lift to mining and oil shares. This fall in the dollar was created by a reduced expectation for a rate hike in the U.S.
The FT100 had a small ex-dividend of 2.9 so this had little effect. The thing which stood out was the 4 waves of 100 point moves during the day indicating great disparity between bulls and bears.
Commodities were the best performing shares with “safe” shares being amongst the weakest – this pattern tends to oscillate regularly.

US & Asia Overnight from Bloomberg
Asian stocks fell, with the regional benchmark index heading for a weekly loss, after Japanese shares declined as the strengthening yen pressured major exporters.

The MSCI Asia Pacific Index lost 0.5 percent to 120.53 as of 9:16 a.m. in Tokyo. The measure is poised for a 0.7 percent decline this week as Japan’s Topix index erased its gains from last Friday’s Bank of Japan stimulus and the yen headed for its best weekly gain in seven years.

“It’s still way too early to say we’ve found the bottom,” Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors Ltd., said by phone. “The nervousness we’ve seen in global markets relates to the strength of the U.S. dollar putting downward pressure on oil and equities. With the dollar looking like it might have topped, the negative dynamic may have been broken. A weaker dollar though means a stronger yen and that makes life more difficult for the Japanese share market.”

Japan’s Topix index lost 1.5 percent, heading for a 4.4 percent weekly loss. The index has wiped out a 5.1 percent rally following the Bank of Japan’s stimulus boost. The yen traded at 116.81 per dollar after rising in the past four days.

South Korea’s Kospi index slipped 0.2 percent. Australia’s S&P/ASX 200 Index retreated 0.4 percent. New Zealand’s benchmark gauge declined 0.1 percent.

China Markets
Futures on the FTSE China A50 Index added 0.2 percent in most recent trading, while those for Hong Kong’s Hang Seng Index gained 0.5 percent. China’s Shanghai Composite Index climbed 1.5 percent on Thursday as the central bank stepped up efforts to ease a cash shortage before mainland markets close for the holidays next week.

Trading volumes could be muted in Asia as investors prepare for next week’s Lunar New Year break. Mainland Chinese markets are closed all week with Taiwan, while Hong Kong is shut for the first three days, resuming Thursday.

E-mini futures of the Standard & Poor’s 500 Index fell 0.2 percent. The U.S. equity benchmark index rose 0.2 percent on Thursday amid a rally in raw-material and industrial shares, as the dollar’s weakness boosted commodity prices and optimism for profits at multinational companies.

Patchy U.S. economic data ignited the dollar’s retreat this week, as concern grows over the vulnerability of the American economy to outside forces. The fixed-income market is all but pricing in zero rate hikes from the Fed this year, as central banks from Asia to Europe have mixed success with their efforts to stymie the turmoil that’s roiled markets in 2016.

While a weaker dollar makes commodities cheaper, and therefore more appealing in other currencies, oil remains an entity unto its own, reverting to losses Thursday as investors focused on the fact U.S. crude supplies are at their highest in more than 80 years. [Bloomberg]

FTSE Outlook and Prediction

FTSE 100 Prediction
FTSE 100 Prediction

Today of course is NFP news at 1330 which makes it fairly hard to predict what its going to do around then. The forecast is 192k, so slightly under the previous report, but around 200k should be seen as a positive. Looking at the FTSE to start the day we have the daily pivot at 5891 for support, but also a bullish picture just starting on the 2 hour chart with support at 5885. As such an early long around this area could be worth a go though I am alway cautious on NFP Friday. Its possible that we rise then dip on the news (buy the rumour, sell the news). We have resistance at the 5921 area where we have the 200ema on the 30min, but we are within a rising PRT channel on that time frame. If the 5871 (bottom of that channel), and just below those 2 other supports, holds then we could well be on for a rise initially. Mind you, if its anything like the recent volatility we might well rise to 6000 in one go! Or drop to 5800! So, generally looking to be long around the 5880 area first thing for an morning rise. If 5871 breaks then 5800 is likely, with the bottom of the 10 day Bianca at 5794. Stay cautious today!

149 Comments

  2. Morning all,
    Think we will have another volatile day, but dont think we will move much higher.
    Still think we will end today somewhere in the 800’s

  4. Morning All,I held that long from 99 from Yday overnight and closed it on the early push up for 28.5pts……..the 0.5 covers the parking charges :0).anyway re entered long at 97.8…..I thought it was premature and it was by about 17 pts ….never mind looking for another 20 even so.Good Luck all.

  5. Morning Anstel,

    Bit more optimistic like yourself, being making higher lows since that breach of 5800 at the beginning of the week and feel there may be an end of week squeeze. Dax is the drag at the moment but if it can push and hold 9420 I think we will get a break of this resistance in the ftse at 5940 level. Long Nick’s call of 5880, looking to add at 5920 for a push at 5940 & will put the stop at b/e 5900.
    GL mate

    1. Morning GG….it must be hard for you going long…..fully understand.Still I’m thinking we could see 16600 on Dow tday…..Dax is in the real world though….and until it lightens up and has a few beers it could restrain the Ftse.its very interesting.to see how it plays out.i might be pressing you short button later if things turn out how I expect !!!!Good Luck…

      1. 🙂 Finally moving a bit,but you wouldnt have thought the Dow out of hrs was only 50 off Yesterdays high from where the Dax was.Funny how often you can watch it stuck,comment on on it and it breaks out in the next bar.Think everyone will push for a higher close today.Dax needs to to improve it’s weekly chart.

        1. Yeah that Dax is not a happy bunny…..I think the Germans are a lot more reserved when it comes to fun and games!!!!…..I’m going to boil the kettle and drown a monkey bag,back in a minute :0)

  7. It’s a bit ominous when all us spring lambs are happily frolicking in the meadow…..and Mr Bear is nowhere to be seen………tmfp what am I missing here…….or are you having a well deserved rest at the top of the waterfall waiting patiently for the Salmon?

  8. Morning All,

    Hope everyone had good fun yesterday. That was a surprise to see 200s again. I have one open position from yesterday on the Dax from 308. I banked some very nice profit and now only have 1/5 of the position left and will leave it running. I bought this position with a GS of 50 with the intention of running it for longer term so can’t touch the stops yet.

    1000 point run anyone ?? 🙂

    2. Nice,I was just looking at the Calendar for something that could be very positive whilst China is shut next week,not much there though,Oil news maybe.

      1. With China being shut that could possible remove an area of uncertainty briefly, and temporarily ,and allow a bit of positive sentiment to seep through to our western markets….what do you think?

        1. Well, some positive news for the markets following NFP and no bad news next week can take the markets up.

          For the past few days, I have been unlucky my position gets stopped out before bigger moves.

        2. Yeah,think they might need a push from something too though.Yellen is talking,so maybe she will be primed to Pump.

          1. My too favourite words……especially when used in the same sentence….yellen and pump :0)…..mind you I bet it’s enough to give GG nightmares :0)!!!!

      1. They.dont appear to be currently available unless you buy them…..I’m going to have a look on you tube.

          3. Nope the fun police have banned it off you tube.looks like we have to exchange beer tokens to watch them at present……

  10. Looking at the hourly Ftse chart we seem to have the 100 sma crossing the 200 in the 5940 area in a declining manner but looking at the Daily we seem to have higher lows and higher highs the last few days as GG mentioned earlier,the 4 hourly looks positive to me as well.Dow looks happy enough on the 2 min…….I’m sitting tight for a while,it feels right as well!

    1. yeah,this pattern of running the up Dow in their overnight can sometimes seem like it was done by people who wanted to sell later though 🙂 so worth being cautious about it.

      1. I’m thinking maybe a short on the Dow later if we get strong rises……got to bare Chinish New Year in mind though as mentioned earlier.

        1. Think it turned down at 487 yesterday,so then 500,511 but NFP and the Friday close mean they arent much.The Dow does look Bullish,hrly,daily,it’s just that everything else doesnt.

          1. If I had to make a guess based on ” my feelings “…..bet tmfp is rolling his eyes now :0)….but I think the Dow is leading people into a false sense of security….shorting it around 16450-480…….I think it’s going to bite some unsuspecting shorters and bite quite big too.

          3. Yes,I would have been pretty stressed about this in the past,probably locked into a narrow range and expecting a breakout and a loss one way or another to take back a week or two.The cynical play has to be Dow up I suppose and next week Yellen wont want to be in Washington answering q’s from attention seeking fat parasites with low I.Q’s who’ve just seen on TV that their unearned investments have taken a hit.

  11. Hey Jack 2 if you see fit if you could get a position on Dax and slap a guaranteed break even stop on it when the position will pay for it.you could just leave it and see what happens with no risk:0)

    1. How can you get a guaranteed b/e stop ? which platform supports that ?
      Just for fun when I’m about to close a position, I open the ig close position tab and close the actual position on the chart just so as to see what I would have made/lost if I were to hold that position. P/L gets updated on the tab even though your position is closed.

      1. I thought you could just put a stop on at your entry price and pay 3x for it to be guaranteed…..am I missing something?

        1. I did have some problems putting on a guaranteed stop about 6 weeks ago late on a Friday for the weekend……I thought my PC was playing up?

          2. how can you do that to put the stop in the same place as your entry ?

            IG doesn’t support that. You have a pay a premium say 1.5/2 points on spread but a minimum of points away. If you want to get a position its better to do it before 1 or else they increase the minimum points away to some crazy 300 points

          3. As far as I can see on city there is a minimum distance and only in market hours…..I wonder if that means you can’t put a guaranteed stop on Ftse after 4.30…… That would explain my problem 6 weeks ago……if anyone can advise further please do so thanks.

          4. On city there’s a little box with the current price in it…..you just tick the stop box and click amend on a regular stop.If you are adjusting the parameters of the stop and it goes into a loss situation the box turns red to warn you.

    2. I was never worried about missing my b/e, it always closes on my b/e, never goes over it. On my platform it never happened. It happened on City Index a lot. But here it doesn’t. Maybe it happened once on NFP day maybe 1 point slip but that’s all I can remember.
      To be honest don’t see the point to pay for a winning position, if it’s not meant to be winning and closes b/e with a little slippage it’s life. But if it’s winning, let it win.
      No, I have a different issue. When I’m on b/e I am afraid that price will go to b/e and I will not get even what I could. But I need to fight it.

      1. Guess what I have done tday Jack…..Again…….I had 45 pts profit on my second Ftse long and held it for more………….I know better…..more Rande Howell thief in the night video views for me over weekend….I closed it in the end for +10…… I was expecting it to push up till the last couple of mins before NFP….but it didn’t…..making a note of that for next time.

  12. Hi fellows
    while the dominating bear is not around, ( think he mentioned about attending nicks seminar or was that hugh.. whatever )
    like to ask you guys what are your Set-ups or reasons to get into a trade, does not matter what it is – fundamental / technical / bloomberg / moon alignment / nicks analysis.
    pls be honest and try and give as much info as you can
    all good to analyse and maybe provoke a good discussion
    anstel, gg33, havies, wsf, rj and whoever else might be there

    1. Hi Paul,
      I will try my best, but am mostly on my phone, which makes it difficult to explain in detail. This morning my trades were based purely on yesterdays movements and the last trade was from Nicks analysis. I am generally a bear bu nature, but dont mind a long here and there.
      Mostly I trade based on news at the time or coming news.
      To give you an outline of my plan for today:

      If we break this 940 before NFP I will long just before news is out. If we dont break it and am at least 20 points below I will wait for news and then short at 40. With the Dax this low I will run tight stops as it is Friday and you never know.

      Should we break the 40 before or after NFP news I will be likely to be long and will then re-evaluate my position.

      Hope this helps 🙂

        1. Hi Paul,

          Not all chart based, but the 40’s are. My stops will be set at 55.

          Ps: if we get lower now I will long again at 770 with a 10pt stop, looking for 840 again.

    1. I should have shorted this, easy 60 points there. One of the things with holding trades, stops you from looking trades on opposite direction.

  14. Good morning gents,
    Dax could be testing 9056 level very soon if no good news comes out. Bulls will have to strong. This is the last level of my 4 year fib fan and it looks like it maybe tested soon. I have one position open from 9425 will see if it works out.

  15. Better give my reasons i suppose
    1. I am a bull by instince
    2. i use 4hrs/1hr/15mins for analysing the general market
    3. turn to 30 – 15 – 5 for the set up
    4. main setup is a breakout – can be a simple support-resistance or pattern based breakout – eg. wedge
    5. i try to combine a 4-1-15 formation breakout with a 30-15-5 breakout
    6. stops are generally at the opposite / failure side of of the 4-1-15
    and the targets are similarly a equidistance move

      1. I sometimes try and prempt the breakout and get into problems
        like yest morning, ehile the afternoon trade was a proper brekout

      2. Hi Paul,

        I follow only price action to an extent predict future patterns and base my trades on that. My reason for yesterday’s long on Dax. Low of 20th Jan was 254. Dax price hit a low of 265 yesterday and started to reverse considering its NFP day today it was a low risk to take the long with a PREDEFINED STOP. It worked out well. I still have a portion of that long open. It more of a gamble today. If low of 254 is broken then more downside which I think is a possibility.

  16. Don’t feel comfortable saying too much Paul for fear of ridicule and a bloody good mauling from our friendly resident big brown Aviva insured bear :0) who is very noticeable by his absence by the way………..I bet he’s thinking let’s see how they all do without me! I’m actually feeling a bit nervous without him being here strangely! Oh well the puppies are off the lead let’s see if we can make it through on our own.think we best all concentrate even harder now.

  18. take it from a reformed trado-holic
    nothing better than trying to explain to other traders what you are doing to get a trade, it often brings out to the open wht you are not doing corrrectly
    ridiculed…doubt that
    there is no one here who cannot be placed into this cateogory
    my shrink always has a motto…..if you don’t tell me…..how will you ever know !

      1. A lot of what I do is based on the fundamentals at the time……..ie Oil (the new qe). China weakness …….negative rates in Japan…..the fact that are markets are managed…..24 hrs a day sometimes watching what the market does in relation to certain events……ECB….NFP….etc etc holidays in other markets mainly America……and a whole lot of what will possible get me ridiculed My feel for the market……if all this lines up with what my basic knowledge of what the charts are suggesting I’m in.tmfps RSI for scalping is the most succesful sure fire approach I have seen unless the markets are being coaxed in which case Id rather leave the counter trend scalping and just watch.Good Luck Paul.

  19. Fail at 5945 again and lack of inspiration from the dax to hold above 9420, bailing out of my longs at 5880 and 5920 @ 5925 for +230. Too much profit to spunk on the hope we break 5945.

  20. 72% short on EUR/USD on IG not a good sign. Are the NFP numbers going to come in less than the forecast ??

  21. While we are all looking at short term profits, which is the name of the game, is there not a near perfect Head & Shoulders on the daily with the base of the left shoulder going back to Dec 2014, top of the head is post Scottish Election @ 7140, with the market sniffing at sub 5800 earlier in the week, that area looks like the neckline with a clean break of that down to under 5300. It only becomes invalid with a move above 6150ish which would tie in with the recent high of the last week at 6128. As a punt with a view I’ve bought the Feb 5500 puts @16 for 50 lots. Max downside is 10% of my account, with these swings on a daily basis RR looks good?

    1. Hi GG,

      I dont have that option on my platform, but Id say its a safe bet.
      If NFP numbers come in lower than expected, then we may be well on our way there.
      I am thinking that everyone is just waiting now, hence the range. No real movement, considering the recent volatility.

  22. Hi Paul I’m mostly looking for a few patterns,usually Triangles,Pennants and a few Candlestick formations trading with trend.Thanks to Hugh and tmfp I’ve dumped most Indicators except RSI at the moment,mostly 10 on the 15min and I use EMA’s,SMA’s,Bollinger.This month I’m just Dax and Dow,because they made most of my money in Jan,and ASX 200 because it’s there.I’m keen on trying to learn from my stats.I used to work bigger timeframe stuff looking for ranges and trying to catch them both ways and leaving longs and shorts open(which worked but didnt suit me,because you can only see your situation and profit periodically and there are regular large hits,still think it is worth doing if you have another income stream),so I have a very strong emphasis on looking for S and R levels right back to monthly for whatever Mkt I’m looking at at the start of every session.I track stuff I think might influence,eg Oil at the moment for trend and also news as well as Prices at regular intervals through the day/night,all pen and paper stuff.At the moment I’m only looking for short term trades,with set targets for points day,week etc etc.Trying to be pretty mechanical and put the hours in.I do change stakes a lot and R/R depending on the setup and at the moment I’m running higher stakes and taking fewer trades because my stats seem to suggest that I’ll get more from reducing the time it takes to regain a loss than from trying to improve win rate.I have a card in front of me with about 3 or 4 Patterns etc on it and so I’m always seeing it.I look for other stuff as confirmation,mostly because I feel better if I can write a good explanation for a trade in my notes when I open one 🙂 Sometimes I use motivational stuff because I get tired lol lot of CT Fletcher,ISYMFS and so on.I’m big on some Trading Gurus I know have fake records,but who I think have useful clarity,mostly guys who suit what I’m doing now eg Richard McCall,been reading his book for years,like Reminisences of…,hence the screen name.Need the motivation,because I need the hours.Appreciate tmfp as a consistency maestro and since watching him I’ve dropped a lot of bad mental habits eg focusing on what I want to do after this period of time ends etc etc Jan was good for me based on my aims,so trying to repeat that with improvements.Way too much writing.

  23. Morning RJ, I think the story for NFP is slightly weaker than expected but from what I hear it will be more about the revision to December’s figure which they think will be revised lower. Any negative or lower figures for January or revision for December and I think we may see quite a big move down…..bad news is bad news once again. GL

    1. Thanks GG, thats exactly my thinking. Dax struggling at the 380 level and EUR/USD
      about to shoot higher. I have it all opposite. Will see how the prices are close to 1.30. I agree bad news will be seen as bad news.

  24. Just placed my orders, one at 30 and another at 40. Stop at 55 on both. Expect there may be movement just before results, hence the two positions. Any orders taken will be moved to b/e stop if 10 points clear.

    1. I don’t remember but there have been days good numbers resulted in sharp sell off that was before rate rise prediction.

    1. Well couldnt post in real time but I gained +49 and +54 on two Dow shorts in that little lot……..made up for missing an additional +30 I didn’t take on that Ftse long at that peak around 9.45 Ish simply because I was too greedy yet again……

  29. precise stop placement promptly taken on the EUR/USD and it goes down. 55 points loss
    Dax long survived and stops now moved to b/e

      1. Yes Jack, I had my stops at 249 and the high was 252 now its at 127. It been like this all this week except this one is a loss and rest were stopped out b/e. Still have the long on Dax running at b/e from 308.

        1. Closed the remaining Dax at 440. 132 points 🙂 Happy with that and will finish the day !! See you all next week.

        2. I suppose it’s part of the trading. It’s always better to keep positive about losses. As long as you make profits in average. I was staying clear of markets today following my surprise win yesterday. I need to take it in a bit and start fresh next week. Besides I try to avoid NFP days as those spikes are generally nasty.

  35. I know I’m a natural bear but NFP well below expectations, Dec figure revised down & a rise in average earnings? I think these figures are all very bearish with the technical strap-on that we haven’t managed to break above 5945 in 3 sessions. Last trade of the week 20 @ 5904, stop @ 5930 run till close. GL ALL

    1. Lol all part of the fun :0) at least one of us will be happy……anyway I’m planning on joining your team later if the Dow gets its act together.

      1. My problem is I’m too bloody slow…..I had + 14 on this long and let it get away again……. Will I ever learn!

  39. I think a close at 4.30 below this 5880 level is a sign of more weakness to come next week but I can’t rule out people trying to close around 5900. Stop is down to 5895 now which I might regret but profit is profit!

  41. more weakness, sell stop 20 at 5864 stop on everything at b/e 5884 if 5864 gets triggered-see if we can break 5850!

    1. If we get some momentum Argyle I agree with you. It’s just a bit shaky at the moment…….thanks for you advice as well.

  44. Agree anstel, 16250 has been a bounce area before……thanks for reminding me. out of stop order bought back 5904 @ 5882 +440 good end to the week.

  47. Afternoon chaps, only just got in, long at 5850, limit in at 5800 to add. Converse to gg33, I think all this bad news hasn’t managed to slap it as hard as it could. Famous last words!

  48. No I agree chippy, thought if we broke 5850 on a Friday it would break hard but it hasn’t , GL what’s your target?
    Out of Dow by the way 16225…..+70

    1. Hey good on you,you had a go. and you made a profit, we will get there if we keep trying…..it’s very difficult trading though I think?

    1. Well that reduces likelihood of further interest rate rises and subsequently is quite bullish for equities. Also $ will loose some of its strength increasing oil which again is bullish for equities, time to go long folks.

  52. It is anstell, almost like you have to wait for a 1% move and then be contrarian for a short term move-look at this week for example, there have been over 10 1%+ moves both ways. You could have been short 5920-5940 6/7 times and been long 5850 5880 6/7 times. Just have to do small stakes and wait for the market to determine its next move. I know you find this hard to believe but I am starting to think you could be right and the next move is up to 6100, I do see the case for people thinking we are laying a MT consolidation pattern for a move up

    2. The Bank shares I follow are all up on the day,and that 200 area on the Dow as S would keep the Bullish look on the Dow day.

      1. I didn’t expect it to see 16180 tday WSF……maybe we will climb back up with the Chinese New Year giving one less area of concern. It’s good that the bank shares are up….tell you what…..I will be glad of a break over weekend…….its a little intense with these wild swings.

        1. Didnt expect it either,think 15 min chart on the Dow can make these moves seem clearer.Yeah,Banks have been getting hit hard and it takes some money to move big caps,so it’s worth factoring in with other stuff.Still a bit early really so if the Dow keeps going up from here be interesting to see how it acts at all the Fib levels.

          1. I have been on shorter timeframe tday WSF I’m short of screen space but the 15 min is quite clear. Gosh this volatility is something else. wears a bit thin sometimes!

          2. The Dax has lost its relationship with the Ftse and Dow and this 9300 is a support level. thats my main concern at the moment because I think it will hold back Ftse and I’m puzzled why it can’t even break 9450 convincingly?

      2. Which banks do you follow wsf? I’ve had a punt on Barclays the other day, I think I posted it, am looking rosy at the moment but would be interested to hear your thoughts.

        1. HSBA and BKIR mainly at the moment chippy,HSBA for a long time,looks like Barc was flat on the day,so up from the lows.Barc always had a very active board on iii (interactive Investor) with some people who trade it seriously and monthly comps.Derren who made the Bianca software used to post there as Barcap (for Barclays Capital I think he worked for them once) worth a look if that helps.

  53. sorry anstel……medium term, so I think there is a chance we move up to your 6100 level which is starting to sink into my thick skull but ultimately I think a fail around there like we have already had will see the next leg down to 5300s. I was looking at a possible daily Head & Shoulders today with the left shoulder at Dec14, Head at Post Scottish Referendum 7140ish in May 15 and I think we are forming the right shoulder now which puts the neckline at roughly Monday’s low which was 5780ish. A sustained break of this leads us down to -5300. But like any chart, it is open to interpretation.

    1. Thanks for explaining MT GG…..I always ask if I don’t know……which chart is this head and shoulders pattern on GG…I’d like to have a look at it if I can? Sorry to trouble you buddy if your busy.

      1. It’s OK GG I found your post earlier……its on the Daily chart…..I wonder how the market will behave in relation to the chart? I suppose time will tell, it will be something else to learn thanks.

  55. Thanks for all the posts today everyone. My orders got missed by little, but another day uh?
    I am still very bearish and think we will see a further move down next week, bit wont marry it. I can see Argyle’s argument for the news to be bullish, so will leep that in mind when the markets open next week.
    Bagged a good few points this week and hope all of you did well too.
    Have a fab weekend. I think everyone deserves a little time off 🙂

  56. Cheers Havies, like you made a few ticks this week but missed out on a lot of good earners by not running longs, a thing to watch at the moment might be spreads between indexes ie dax v ftse or dow v ftse as they are usually quite boring but they are moving around quite a bit with some good scalping on the arb if you’re nimble but best to plot them and work out decent entry points. Also, Gold at 1160 is telling us something!

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