Snap General Election | 7109 7060 support | resistance 7223

19th April 2017

Good morning. Well wasn’t expecting the FTSE to shed 200 points yesterday thats for sure. Was a bit of a surprise hearing PM Theresa May call a snap general election for 8 June, especially as not that long ago it was something that she said she wasn’t going to do. Politicians eh! The FTSE100 sold off from 7am yesterday, initially blamed on miner weakness and a strengthening pound, though also some might have got wind of that 11am announcement too.

We ended up with a trending day which are a bit of a pain unless you are already on the right side of the move. Suffice to say that after that fall the longer term charts now look a lot more bearish – 2 hour has resistance at 7230 and the daily has resistance at 7305. We also have the French elections coming up, as well as tensions over the US and North Korea, and now also Iran. Todays FTSE 100 dividend is 3.1 as well so bear that in mind for the close.

FTSE 100 Outlook and Prediction

FTSE 100 Prediction
FTSE 100 Prediction

I am thinking that we might see a bit of a dead cat bounce initially this morning, which may well turn into some traction for the bulls, as long as they can hold above the 7100 level. There is the 20 day Raff at 7109 and a fib level at 7103 and if they can hold this area then we may well see a rise up towards the pivot at 7196.

The ASX200 showed a bit of a miner recovery with an initial rise, and we may do the same, as yesterdays news is digested. The main issue is that the run up to the election leads to uncertainty and the market hates uncertainty! We also have the French elections coming up and the background threat of the US/NK skirmishes escalating into something more serious.

If the bears manage to break the 7100 level then a trip down to 7062 looks pretty likely, with S1 and 7045 below that. Then we are looking at 6962 for S2 and possibly even 6930! I expect that we will get a bit of a bounce around the 7100 level though as all the while we have been around 7300 to 7400 area there has always been the chance of a trip to 7100 if 7250 broke. I just didn’t expect it to go from 7330 to 7120 in one move though.

For the bulls, if they can break the pivot at 7196 then the 2 hour chart has resistance at 7232 and then the daily at 7305.

I am thinking though that if 7100 can be held we may be on for a run back up.

30 Comments

  2. Agree with Nick. After a long daily candle like yesterday it is normal to retrace at least half its length over subsequent sessions which sets up a target of 7220 initially. Even if its slow. It is not correct to be short now as long as 7100 is holding as support. Obviously a breach of same is a short. So I have allocated 20% of capital long with stop 7090 and hopefully get to review things higher up.

    1. Candlemaster,I do think sometimes you are missing out on a lot of points by waiting for too much confirmation of a move…..by the time you enter the market has made its move…..it’s like the other week when we were at 7260 support you said you were waiting for 7350 to enter…I personally started scaling into my position around 7270…. I just think maybe it’s more about predicting what’s going to happen rather than waiting till most of its happened…..I’m no candle master though my technical side is very basic but I suppose we all trade in ways that suit us….whatever,good luck in any case…..

  4. Morning chaps…well I don’t know if you were awake last night but the Ftse was gaining some composure at 7131 when Asia opened at 1 am..the Ftse took a sharp dip down hitting 7104 at one point….I’m playing defensive at the moment, my concern is any geo political events that could ruin this tentative retrace……I’m cautiously long but will liquidate if the need arises …..and have reduced my exposure favouring a “there’s always another trade mentality.”…the market has changed from 30 odd point daily movements to much bigger swings so size needs to be reduced accordingly…best of luck all….and Nick,I hope you are doing ok after recent events …..

  5. Anstel thanks for that info i did,t realise FTSE dropped that low last night , i had long order at 7102 !! Trading eh !!

    1. Yeah it was quite scary actually and I’m quite composed most of the time…..it took me back to Feb 2016 when I got in a right mess…..it takes a lot to trigger fight or flight in me now but last night I must confess I felt a twinge or two :0)

      1. As for now we really need to get past 7150 to make this move stick…I think we will,eventually….

  6. One of the things tmfp taught me and there were many ….was mental fibs ….we have seen approx 7150 or just over and we pretty much started this early morning at 7120 so 7135 is an approximate 50 % retrace from the previous high.and we dipped to approx 7128 which is I guess 61.8% retrace very approx …..for me it makes it easier to get a rough possible entry area as long as we have the trend correct……I prefer mental fibs along with a general feel of the market….

    1. Another thing that tmfp taught me and others on here was the inaccuracies of RSI after the market has been in a tight range as it was mostly overnight….it needs to get a range initially to be more reliable….just thought I’d share, it might be of help….

      1. Agree with that. I think that implicitly means taking signals from higher timeframes as we have better price movements

  7. Well while I’m sat here waiting for Ftse to recover its confidence I thought producing your own dip might be cheaper than buying them,? What do you reckon Tufty Buttons :0) will these go with your nachos :0) https://youtu.be/kDfL9Xwi9Hg

    1. I think that’s where I’m going wrong…:0) next time I buy the dip I’m going to put it in a pumpernickel bread bowl :0)

  8. Think I will go and take grommit for a walk, it’s a bit quiet on here tday….good luck all….

  9. Looking at a daily price chart going back 18 months the 7110 – 7120 price area has been critical support and resistance on a CLOSING basis. A close below tonight would look pretty bearish.

  10. Well the hard trade in this case would appear to be short…….it certainly doesn’t look like its interested in going up at the moment ….could change but maybe this is our new range for the time being till the out of the water longs get closed,out of frustration….like Si said is this the time buying the dip isn’t going to work after all the times it has before…..hmmmm time will tell…..

    1. It appears that the time of posting our comments is incorrect Nick if I’m not mistaken…..just noticed…..

        1. I think Nick has had more important things on his mind Jack…..I’m sure he will be able to rectify it but it’s not too important if we know it’s an hour out……hope you are doing ok Jack…. Good luck…

      1. I would rather not give out target areas Jack just now…..it’s not beneficial I don’t think to broadcast all our position placements at this time….we are trading on a very sloping playing field as it is ……there’s no True market value that is quite obvious,or if there is the Ftse is probably worth about 3500 all in at best..

      2. I can imagine how hard to set targets right now. I just hope your average in not more than 100 points off.
        I am OK but my trades pretty much on b/e this month. I had a lot of family commitments: piano exam (not for me), school holidays. Next week I am back in a game. GL

  11. We should start to see divergences now if 7100 is to hold. There are some initial signs on the hourly but this is very early and has to develop . Maybe tomorrow will bring more clarity

  12. Just half a point left on FTSE to break the morning’s low. Or could it be a temporary long (support)?

  13. Or of course it could just be a severe case of tree shaking to see if anything else with weak hands will fall out!

    1. When you think we were just over 7400 last Wednesday or Thursday morning you have to smile really don’t you …..

  15. Evening chaps,every trade we make has a finite life….it may be 5 mins 5 hrs or a swing trade over a week…I was happy with my long position, it was the correct trade at the time I placed it.but my target was missed by about 12 points and the trade is no longer valid….I have liquidated my long position,not an easy decision but it’s the right one for me…..looking forward to a lovely nights sleep without having to worry about Asia opening tonite at 1 am…I might be wrong but my trade was past its sell by date…. I’ll be back,goodnight chaps…

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