Support 6166 6155 6150 6080 6030 5993 Resistance 6194 6213 6232 6243 6275 6297

Good morning. That was a cheeky little stop killing spike up to 6298, just after the short had taken, to trigger the stops before a 100 point drop. Definitely annoying when that happens. Overnight weakness dropped right back to the 200ema at 6150ish but has seen a little bounce since. The markets are still pretty jittery and will be as we approach the Fed rate decision next Thursday. American stocks failed to add to their second-biggest advance of the year, as early gains following a rally in Asia faded amid jobs data that bolstered the case for higher U.S. interest rates. Losses worsened in late Wednesday trading as Apple Inc. slumped after unveiling new products.

US & Asia Overnight from Bloomberg
Asian stocks dropped, after the regional benchmark index surged by the most in six years on Wednesday, as data on American job openings bolstered the case for higher U.S. interest rates.

Inpex Corp., Japan’s biggest energy explorer, slid 5.4 percent after crude oil futures declined. Murata Manufacturing Co. fell 3 percent in Tokyo, pacing losses among Apple Inc. suppliers after Apple unveiled new products. Mirae Asset Securities Co. plunged 18 percent in Seoul, heading for a record drop, following a report the South Korean brokerage is considering a bid for rival Daewoo Securities Co. as it prepares to sell 1.2 trillion won ($1 billion) of new shares.

The MSCI Asia Pacific Index sank 1.6 percent to 127.37 as of 10:32 a.m. in Hong Kong after jumping 4.2 percent on Wednesday. Japan’s Topix index lost 2.1 percent as the yen halted three days of declines. The Standard & Poor’s 500 Index slid 1.4 percent on Wednesday as investors weighed the implications of the employment data for next week’s Federal Reserve meeting.

“Markets will remain volatile until the Fed meeting next week,” Nader Naeimi, Sydney-based head of dynamic asset allocation at AMP Capital Investors Ltd., which oversees about $118 billion said by phone. “Investors are again focusing on the potential U.S. interest-rate increase and how it would impact emerging markets.”

U.S. Jobs
Job openings in the U.S. surged to a record in July, data released on Wednesday showed. Fed officials have to consider whether market turmoil that began last month will offset the labor-market improvement and interrupt plans to raise the benchmark interest rate for the first time since 2006. Futures traders saw a 28 percent chance that the Fed would increase rates in September, down from 32 percent a week earlier, data compiled by Bloomberg show.

China’s Shanghai Composite Index dropped 0.5 percent, paring earlier losses of as much as 2 percent. The nation’s consumer prices rose 2 percent in August from a year earlier as a pork supply crunch drove up the cost of the staple. That’s the fastest pace in a year and compared with the 1.8 percent median estimate in a Bloomberg survey of economists. The Hang Seng China Enterprises Index of mainland stocks traded in Hong Kong fell 2 percent, while the city’s benchmark Hang Seng Index slipped 2.2 percent.

Regional Gauges
Japan’s Nikkei 225 Stock Average plunged 2.9 percent after surging by most since October 2008 on Wednesday. Taiwan’s Taiex index slid 0.3 percent and Singapore’s Straits Times Index dropped 1.6 percent. Australia’s S&P/ASX 200 Index decreased 2.2 percent. New Zealand’s NZX 50 Index was little changed after the central bank cut interest rates and said the currency should fall further. South Korea’s Kospi Index retreated 0.1 percent.

E-mini futures on the S&P 500 lost less than 0.1 percent after the underlying equity gauge failed to add to the second-biggest surge of 2015. Apple, the largest-weighted stock in the S&P 500, slipped 1.9 percent. [Bloomberg]

FTSE Outlook

FTSE 100 Prediction
FTSE 100 Prediction

The ball is in the bulls court today and they have to build on the 6150 overnight support today otherwise we are heading down to 5700. That is probably coming but maybe not quite yet (maybe October?). We have the daily pivot at 6194 initially so there is resistance there for this overnight bounce, with 6245 above that. If the bulls were able to break that then 6297 is the top of the 10 day Raff and yesterday’s high so another key level. Support wise, there is 6165ish initially on the 10min chart, which I think might see some reaction, as there are a few supports in that area across the board. Its a case of deciding if you feel bearish or bullish…. The 2 hour chart has turned bearish for the moment, so I am expecting an initial dip from this 6194 level to start the day.

73 Comments

  1. I got well suckered in there long yesterday, can’t hit a barn door with a banjo atm, lucky to get out before the stuff really hit the fan.

    A bit better so far today, took some on a 200 short, shorting again now at 6204 looking for resistance to hold, 12 stop.
    Looks strong though.

        1. Your shout entirely mate, but all I see is 6160 holding well and a higher high atm.
          If there’s a pull back to 6200 it will be important whether that holds, otherwise, not a f***ing clue.
          🙁

          1. just hit the 50% fib
            cant see this move holding
            so even on a conservative basis 6170 looks very probable

  2. Looks like it may be going for the 61.8% retrace at 6229 (closing price), though it’ll probably tease us as well. Any bets on the US dumping on us for the third day in a row? B of E rate decision/minutes at noon as well.

  3. still short from 6217 with hope of 6170
    which is completion of C wave
    however if this breaks then we are in W-3
    so lets see rates at 12, non event but mpc votes could be impt

  5. I have the limit on my 80 short set @39 so hopefully looking for that and hopefully get back in later around 60

  8. Coombsy, I think all dependent on dow.bearish divergences on dailys signal for new lows. But all dependent on closing prices.

    Hi Paul, what timeframe are your counts on?do you now get wave C on the dailys?

    1. Paul, I would suggest hold the shorts. I have one running on the dax from 306 and am holding with stops be +1.

  9. One thing I would say, prompted by reading Pete’s plan ^, is that I think one of the reasons I am so out of touch atm is that I haven’t fully come to terms with the increased daily ranges now that we are essentially trendless.
    I have been thinking like Pete is (all due respect mate) there, out at 39 back in at 60 i.e. 21 points. With these daily ranges of 100 points + that’s not a lot % wise, and it’s important to re scale one’s thinking accordingly.
    That is all.
    🙂

    2. Yea tmfp I was a bit greedy there if only it worked out like that all the time, I still have my 80 short as I think we will see more downside this afternoon (me been a bear again) target this evening 6050 that’s putting my neck out now

  10. that’s true tmfp. I am also stuck with the same dilemma. What’s looking like a developing bearish divergence now may quickly change with a bullish divergence on a lower time frame. For example, if 200 sort of holds on dow we will be back up in no time!

    1. this is why elliott is good.
      there is no wrong count as such!!
      the count may extend, but you can always be on top of the previous count which becomes sharper into focus as time develops
      like above – we were in C wave which could extend and develop into a W-3 where you can now build the beginning of the W-4, so you know C has completed, the rules are strict enough to make price levels as targets and entries

    2. Hi Icarus,

      I’m staying short for now & I don’t want to influence anybody but I follow Eric Muathe and he’s very good, he predicted yesterday sell off and the big drop in August, worth taking a look at, again just my opinion

    1. icarus
      i was referring to daily Elliott waves
      even though we are in w-3 in the 15 mins
      w-4 is still the dominent in the daily, so a pullback is definately possible which would tie in with w-3 completion
      but referring to your daily 13ema – sure, but tricky picking 13 or 10 or 18.5 ,
      you can always make one of them fit perfectly

  13. Closed my short @50 better banking my 30 points, looks like we may get a slight retrace for the US, but I,m still in bear mood

    1. not sure what made you close your shorts?
      market looks like well placed for a breakout to the downside
      Wave – C turning to W-3 is a classic breakout

  19. I am surprised by a long prognosis for today, shocked to be honest (just opened charts after yesterday’s rest). All that EMA’re suggesting to me right now is down down down. Maybe I am wrong?

  20. Yesterday may have been a short covering false breakout, but we’re still in a pattern of higher lows and highs since 26/8, with rising support currently around 6100.
    With weekly RSI/stoch bumping along the bottom, I don’t reckon much is broken on the upside until 6100 fails.
    This isn’t being bullish because I’m not, but I don’t think it would do any harm to approach this as a 6100/6300 range market for the time being.
    I got sucked in yesterday on the long side for what I thought were at the time pretty valid reasons, be careful it doesn’t happen to you on the downside.
    Tl:dr-Don’t short weak looking markets.

    🙂

    1. exactly agree – that’s why i’m not following the flow. Was gutted yesterday though. The bear in me was roaring

  26. Getting a bit sea sick with all these waves, whatever wave we’re in, I’m just going to ride it lol 🙂

    1. Yeah, it looked in the mood to go though, I actually did something right and bought at 72 on the break for 12 points, Yeehaa!
      Will 70 give a bit of support now or will it get trashed into the close?

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