Still short the rallies | 7380 support broken | 7280 next | Trading Help

30th June 2017

That was quite a drop yesterday of over 100 points to 7305. I was out all day yesterday so only sporadically watching and was quite surprised when I saw the 7352 long had taken! Turned into a decent knife catch as it rose up to the 7380 level before dropping back to 7305. Some bulls appeared though but its looking like we might test slightly below that and I am looking for 7279 soon. Shorting the rallies has definitely been the right stance for this week – sorry I was like a broken record repeating that every day! At least the 10 day Raff channel support held at 7307 anyway – always a good daily channel to watch that one. Cable above 130 again now, so good for the FTSE bears, not so good for the bulls that wanted 7650!

Asian equity markets slid after a selloff in U.S. stocks reawakened volatility as the quarter draws to a close. The dollar extended losses with bonds as central banks worldwide shift toward a more hawkish tone.

U.S. inflation remains in focus Friday with the core PCE deflator, a favorite Fed measure. Analysts expect the month-over-month number eased to 0.1% for May and the annual rate slowed to 1.4%. Personal income and spending are also expected to grow more slowly than the 0.4% rise in April.

FTSE 100 Outlook and Prediction

FTSE 100 Prediction Daily Channels
FTSE 100 Prediction Daily Channels

For today I am looking at resistance at XXXX where we have resistance on the 2 hour chart. This is looking decidedly bearish now after that drop yesterday, though has in fact been showing a bearish trend since Tuesday – hence my constant repeat of “sell the rallies” this week. Like a broken record! Above this resistance level then xxxx is the top of the 10 day Raff but with the current backdrop it might struggle to reach that level (it might struggle to reach xxxx today too!).

So, as its still bearish, that leads me onto the next level I am looking at which is support at xxxx – this is showing as fairly key as daily, weekly and monthly support. If the bears break then 7100 is pretty possible in fairly short order. The bottom of the 10 day Raff for today is xxxx, and the 20 day is slightly below that at xxxx. With the bounce from the 7305 low, we are just above the bottom of the 2 Bianca channels for today, support from them at 7327 and 7338. Could well be a dead cat bounce though.

Bulls will need to be quick out the blocks though there is initial resistance on the 30min at xxxx and then the daily pivot at 7366. ASX200 was down today, cable is up, and its a freaky Friday, so stay nimble again! Volatility is firmly back so watch the levels closely – if a key level breaks, then cut and run or reverse position!

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46 Comments

  2. Morning anstel. Well I am expecting a decent rally from these levels. 7500+ would be the target. I wouldn’t rule out a drop to 275 area though. Planning to hold longs for now

    1. Morning,I looked at the price of BP earlier it was 441……good income share…..there’s money looking for a home still out there,just have to see how it goes but all depends on you know what…..price alert set.going back to sleep I’m tired….

    2. Unless it gets back above 7350 and particularly 7380 we’re done with 7400+ for a while. Given the number of hits to 7380-400 before the break that area should be major resistance. If we clear it then I agree 7500 is probable but got to give the bears benefit of the doubt here and expect 7300 to break first

      1. The 200 sma on 15 min is at 7384…… Probably going to take a few attempts at breaking it……as it was good support on the decent…if it gets above I will be much happier…

  3. For those curious, we are ending or have ended wave 3 in the correction. Wave 4 should take us back up

    1. I’m pretty sure that’s what Georges Hedge is…..

      If one goes up the other will come down so he’ll win on one of them. He’s not trying to win on both.

      It wouldn’t be a hedge if he was hoping they both go the same way.

      And yes markets like weak currency.

      1. Though how did you size that ‘hedge’ George ?
        (I never see the point in hedging positions of retail size that can be filled at market instantly)

    2. mcg – where are you taking profits? was thinking around 40 if it doesn’t hit hard

      1. Taken half at 52 and stop to breakeven.. but expecting a drop to 30-40 this afternoon. Probably going to stay in a trading range as US closed Monday afternoon and Tuesday

  10. Well I didn’t read the hedge bit. If it’s a hedge then wrong direction chosen by George. I reckon we will see both ftse and cable fall together today. Should surprise most punters

  15. Cant understand anyone wanting to go long , when it get slams down the day before…
    7380 is now resistance, I’m looking for a good retrace into the summer… Yellen comments above never seeing a crash in our life times, this tells me internals are weak….

    1. Agree George.. 70 points is a big retrace in these conditions. Have to assume 7380 is major resistance given it was major support

  16. I am now seriously considering closing the longs. Mind you 7500 is not as far ad you think, a matter of days

  19. Closed the other half from 7377 at 7337.. could be a cheeky test of 7310 into the close as it’s month end, but not expecting the range to break.. if that did happen would probably head back to 7340 tonight

  20. +415 points for the week still short 1 @7375.

    Closing @10 or selling again @60

    1. Just covered my remaining shorts.. will exit the cover if 300 gives way. With the US closed I think maybe a couple of days of rangebound before the break lower

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