Possibly 6759 today, outside chance of 6790

Good morning, hope you had a good weekend. Well wasn’t Friday bullish after the jobs news? We got the spike down to a low of 6640.8, which just missed completely nailing the buy order at 6641 by a mare whisker, however we did indeed bounce as expected so just hopping on for a  run to 6720 worked out well, I know quite a few of you got most of that move. It is funny how good news one day sends it down on tapering fears, and then good news on another day makes it rise! Not a lot of reason to that, and another reason why trading major news is so tricky.

Optimistic Week from here

Rising business confidence, faster growth, a further fall in unemployment and an expected slowdown in the inflation rate will set the scene this week for the Chancellor and the Bank of England to be more bullish about the outlook for the economy. A clutch of official data, optimistic surveys and reports are due out today, providing increasing evidence that the business community is raising its sights and putting Britain on course to run the US close to achieving the fastest rate of growth in the world’s developed economies next year.

Two key economic indicators will provide further support for growing economic sentiment, and bring close the prospects for a rise in interest rates. Official figures tomorrow are expected to show the consumer price inflation rate down to a six-month low of 2.5pc, followed by another appreciable fall in unemployment on Wednesday.

Asia Overnight from Bloomberg

Asian stocks outside Japan fell as investors await the conclusion tomorrow of a meeting of China’s leaders on economic reform. Japanese equities rose after better-than-expected U.S. payrolls data weakened the yen.

The MSCI Asia Pacific excluding Japan Index lost 0.5 percent to 467.63 as of 12:56 p.m. in Hong Kong. The MSCI Asia Pacific Index, which includes Japanese shares, was little changed at 139 after closing on Nov. 8 at the lowest level since Oct. 8. Chinese President Xi Jinping and Communist leaders tomorrow conclude a four-day gathering.

“People are waiting for the announcement to come out and how authorities intend to fund new projects or do new reforms,” said Khiem Do, Hong Kong-based head of Asian multi-asset strategy at Baring Asset Management Ltd., which manages about $51 billion. “I think investors are saying, ‘OK, I’ll lock in some profits and may come back’.”

U.S. Jobs

Futures on the S&P 500 lost 0.1 percent after the measure jumped 1.3 percent on Nov. 8. American employers added 204,000 workers last month after a revised 163,000 gain in September that was larger than previously estimated, Labor Department figures showed Nov. 8. The increase in payrolls topped the most optimistic forecast in a survey of economists.

The Federal Reserve said it needs to see more evidence of sustained economic improvement before slowing its $85 billion of monthly asset purchases. Economists predict the central bank will maintain bond purchases at the current pace until March, according to a Bloomberg survey conducted Nov. 8. Policy makers next meet on Dec. 17-18.

“Markets are going to be worried about how quickly the U.S. is going to start removing some of its stimulus program, but I think overall economic data is supportive of equity markets,” said Stephen Halmarick, Sydney-based head of investment markets research at Colonial First State Global Asset Management, which oversees about $160 billion.

FTSE Outlook

ftse 100 prediction
ftse 100 prediction

After Fridays moves, the momentum is still with the bulls for the moment, however, with the rush of recent high profile IPOs (often signifying a market top) of Twitter, Merlin, Royal Mail, it will pay to not fall in love with the upside. We have lots of data out this week (starting Tuesday) as mentioned above, all of which is largely expected to be bullish. For today I expect that we will almost definitely hit 6759, maybe after an initial dip to the 6720 area where we have the SafeZone on the 30 minute chart. The key level for the bulls to hold if we do dip from the 60 area will be the 6700 and if that breaks then we won’t be seeing 6790 anytime soon. The main play therefore is the short from that 6759 area. If 6700 does break then the daily pivot at 6668 is likely to be hit. I have the 6760 area as the top of the 10 day Bianca, and it is also a ProTrend channel and general “join the highs” line as shown below by the 3 blue circles, albeit with the ProTrend line showing 6768 so slightly higher.

81 Comments

  1. It always re-enforces my confidence when ive already opened a position, then i read this and find we’re on the same page– long from 6708 🙂
    informative as always thanks nick

    1. Sam Target 6745 minimum for me. Im LONG from 6711… If you don’t fancy riding the LONG maybe start looking at 6745-6760 area to short

  4. .. “I expect that we will almost definitely hit 6759” supreme confidence is this a sell signal? lol 🙂

          2. Simple terms.
            When the companies pay out their dividend, their share prices, and therefore the FTSE will drop to take account of paying out the dividend.

            So tomorrow at 4.30 (or depending on your trading platform, a bit later) the FTSE will drop down 11 points.

            If you are on a short then it will move 11 points in your favour, and if you are on a long it will move 11 points against you……HOWEVER, the trading platform will also apply the dividend to your trades. So if you are long, you will be paid the dividend of 11 points straight into your account balance. If you are short, you will pay 11 points from your account balance.

  7. Gone long at 6719,9 after the double top of day and the swing in minute chart at 6720 level.
    Already with stop at b/e.
    Let’s see if it has legs. The 4 hourly chart still missing that EMA crossover at 12:00am
    But the daily candle seems to start to have some follow trough

      1. Wait until US Markets open tomorrow… With dividend as well i expect we’ll get Nick’s 6759 level minimum

  13. Strange day… If that 6730 area breaks could see a quick 30 pips… But thinking about going short as its held all morning despite being hit numerous times

      1. Haha patience… I’ve gone Long at 6731 so we’ll see whether they’re playing games or it fully breaks

          5. draw a ascending trend line in the 5 minute chart from the lows of the day and let it go

  14. Jim; the two dojis on Dow represent last night and today’s (non trading) day so far, they are of no consequence and best ignored.

  16. FTSE is in a rising channel since about 08:50 this morning – now nudging upper Raff boundary. Otherwise, I guess that FTSE will be hauled up by the bullish looking US pair over the next few days.

    1. After the gyrations of last Thursday and Friday, the FTSE is holding its ground now, as is the US pair … 😉

      1. What are you chatting about? Are you now saying its dangerous to go Long at this level lol… Make up your mind. Unless i’ve misunderstood your last post.

  26. I happen to share the bullish sentiment, only thing that worries me is when we’re all talking up the market has a wonderful habit of surprising!

  28. I’m neutral, right now. Did not book my profits again +25 points and was stopped in b/e.

      1. frustration and more frustration. Until I change my mental target I will go no where.
        15-20 points should do for a day. 25 is excess…

  31. I went Long at 6703, got stopped out… But re entered at 6695 and holding until after Dividend. Stop to b/e

  34. I’m using plus500 for trading FTSE 100 – their instrument is called UK 100 and is around 15 points below the FTSE.

    Should I be using something else to trade FTSE?

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