Support 6283 6265 6240 6205 Resistance 6319 6340 6376 6392 6402

Good morning. The markets are very thin at the moment with small volumes creating quite big moves in prices. This may explain some of the big moves yesterday with financials and some house builders moving sharply higher while commodity price concerns kept commodity related shares (including gold related shares) to the downside. It’s probably quite a dangerous time to trade as things can quickly move against you – also direction can change on a sixpence with volatility being high. Whether 6320 (a key trend channel level) will be breached to the upside convincingly by the end of 2015 is unclear but it is a level to perhaps focus on.

US & Asia Overnight from Bloomberg
Asian stocks advanced, paring the regional measure’s annual retreat, as financial and technology shares gained following an equities rally in the U.S. and Europe.

The MSCI Asia Pacific Index added 0.4 percent to 132.31 as of 10:20 a.m. in Tokyo. About two stocks gained for each that slid on light volume across the region. Australia’s S&P/ASX 200 Index rose for a ninth straight day, heading for the longest winning streak since February.

The Asian equity gauge is poised for a 4.1 percent drop for the year, led by Singapore’s Noble Group Ltd. and Macau gaming companies. After outperforming global shares in the first six months of the year, Asian equities slid in the second half as China’s surprise yuan devaluation and concern about the Federal Reserve’s interest-rate outlook curbed investor appetite for the region’s stocks. The measure has steadied in December, poised for a 0.4 percent gain.

“Today will be about looking favorably at the global moves yesterday, and relief that it looks like we’ll be able to end the year on a positive note,” said Chihiro Ohta, general manager of investment information at SMBC Nikko Securities Inc. in Tokyo. “We’ll keep on being moved by the oil price. We’ll have to keep being aware of this for the first three months or the first half of next year as well.”

Japan’s Topix index rose 0.5 percent on the measure’s last trading day of the year. South Korea’s Kospi index slipped 0.1 percent. Singapore’s Straits Times Index added 0.2 percent. Australia’s S&P/ASX 200 Index rallied 0.7 percent and New Zealand’s S&P/NZX 50 Index increased 0.5 percent.

In Hong Kong, futures on the Hang Seng Index added 0.2 percent in most recent trading, while contracts on the Hang Seng China Enterprises Index were little changed.

Toshiba Corp. jumped 6.1 percent in Tokyo. The maker of chips and home appliances is considering Fujifilm Holdings Corp. as one of the candidates to buy a stake in its medical equipment unit, Yomiuri newspaper reported, citing an unidentified person. Toshiba climbed on Tuesday as it sought $2.5 billion in credit line to pay for the cost of restructuring its businesses following an accounting scandal. Inpex Corp., an energy explorer, climbed 1.2 percent, while Australia’s Woodside Petroleum Ltd. advanced 1.1 percent in Sydney.

Futures on the Standard & Poor’s 500 Index increased 0.1 percent. The underlying U.S. equity gauge climbed 1.1 percent on Tuesday as West Texas Intermediate crude jumped 2.9 percent.

A decline by the MSCI Asia Pacific Index this year would be the measure’s first back-to-back yearly loss since 2002. Shares on the gauge trade at 13.9 times estimated earnings, compared with 17.7 times for the Standard & Poor’s 500 Index and 16.1 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg. [Bloomberg]

FTSE Outlook and Prediction

FTSE 100 Prediction
FTSE 100 Prediction

Looking at the chart for today I think we may get a dip and rise, with yesterdays 6320 being strong resistance for the moment, We have the top of the 20 day Bianca channel here and a small overnight dip from there so far. The daily RSI(10) is sitting on 64 at the moment so a little high, a pullback would therefore create a bit of a spring board for a push higher later today and tomorrow. We have support at the daily pivot at 6284, with 6245 below that looking like a decent spot for a long. There is a 30min channel as well, with weak support at 6265ish, and the 10min chart is currently suggesting a bit of a dip first thing. So, am still feeling weak bull for the moment, with just 2 more trading days to see how we close out the year.

58 Comments

  1. Morning.
    Good one on catching that 6300 spike Nick, also your 65ish support seems to be holding atm.
    As you rightly say it’s a tricky low volume trade now, which is also cheap to manipulate for players with interest in option strike prices and stuff like that.
    I’m pretty cynical, but yesterday’s action in Apple, for example, was breathtaking

    http://i.imgur.com/NJ0n5zP.jpg

    Not much in it today for my rsi trading, but I picked up a bit of Jan VIX at 17.60 for when NY’s reality sets in. Limited downside even if the bullshit sorry bullrun continues, I reckon 3:1 r/r.

    1. Well here we are, back in the 90’s. See if I can repeat yesterday’s success with a short at 94, 10 either way.

    1. Hi Coombsy, I thought I was the only one who turned up for a shift today.
      As said above, a difficult day to trade, I’m taking profits as and when I see them, not looking for too much.
      Do you see much beyond 300? Got rejected fairly decisively yesterday, but who knows?

    1. Certainly time to think about taking a profit on longs short term imo.
      Yes thanks, still v low on energy, it was a bastard for 72 hours.

  4. Stopped out at 90.
    I was off work for a week with it in October. Mind you allowed me to watch the markets more. 🙂

  5. I know if you use the hedge button then a bet in the opposition direction will open as new rather than closing out the initial bet, but what if you already have bets open in both directions on the same instrument? For example, let’s say you open a bet on Vodafone long, then decide to hedge it short so you have open bets in both direction. You then decide to open another bet let’s say long, by again hedging. Will the hedging work to open yet another new bet or this time close the existing short bet since you already had long and short on the same stock (let’s say the DFT)? To put it simply, if you keep hedging the same stock will the bets open as new each time, or just the first time?

    1. I’ve just opened 4 FTSE trades on the IG demo account – 2 long and 2 short so it is possible. Make sure you click Force Open though. What’s the point though Anton???!!

  6. I think it depends on your spread bet company I think ig allow you to open as many bets as you like in either direction . Just your responsibility to monitor them all. Could get complicated as to what is hedging what.

    2. Yeah, IG have a “force open” button but as Coombsy says, could get complicated plus of course, you’re paying extra spread every time.
      How can you hedge a hedge in the same instrument anyway? Or why?

      1. It works as a trade in a different timeframe,not necessarily a Hedge.With something like a PLC not too complicated and logical around div time,say,easier to follow than multiple indices imo fwiw.

    1. I think Dax is playing off 200sma on daily.Paranoid analysis says they have a close for the yr that works for them already in.

      1. When is paranoia realism?
        Certainly the DOW shennanigans yesterday seemed entirely year on year close fixated.
        In Britland, we’re far too mature to worry about stuff like that 🙂
        (Cue miraculous 230 point rally).

        Talking of rallies, there it is, bang on time, the noon one.
        Cynical much?
        I will however, take the pullback opportunity to halve my short for the technical reason of being bored sh*tless.

  8. Hello All, hope you all had a good festive period, sorry to hear about the man flu tmfp, it can be very dangerous!
    Now back on line and see that luckily enough I got pulled out of everything at 6300 yesterday, happy days. I think that was one of my longest rides ever! Going to sit on my hands and see whether there is a “dummy run” tomorrow above 6300 again but my incliniation is to ease a bit out if we get anywhere near 6350.
    Good luck all for 2016.

  9. Very hard to get a rhythm going with pips so spaced out and volume so low, even harder to second guess the DOW.
    More Plunge Protection Squad antics, or an overbought sell off? Your guess…..

        1. out for 9 but selling a brief bounce I think.
          Can see 50’s or lower by the close, DOW willing, we certainly show no signs of wanting to go up on our own.

  10. Cor I keep getting beaten up, last two trades have stopped me out. Probably rushing my decision making and time for a fresh look. Break time. Seem to do better when the Dow not so much of an influence, or is that my uneducated view. ?

    1. Good entries are crucial in choppy bitty markets like this, especially when you’re using tight stops.
      I try to enter at S>70 L<30 1 min rsi (apart from when I get over excited 🙂 )

      1. Well I have been telling myself not to counter trade and go with the trend more but this afternoon has been the oppersite. no sooner did I place the trade against me it goes. Gave up the good profit from this morning.
        Any views on run up to close?

        1. Just posted up there ^^ at same time as you.
          I think my 50’s is a bit optimistic now, but what will be will be.
          We’re essentially trading a £DOW which I don’t like.

        2. The trouble with that is there isn’t an identifiable trend today really, just a 40 pt range with both extremes tested twice.. RSI entry doesn’t work well if there is.

  11. Happy New Year to all.

    FTSE Shorted at 6287 stop 6375 target 6201
    Tempted to short DOW at 17728

    http://www.fxblue.com/users/goldsignal
    Total return: +89.0%
    Monthly return: +83.6%
    Weekly return: +15.6%
    Peak drawdown: -1.0%
    Trade win %: 84.0%
    Profit factor: 4.28
    Pips: 923.2
    Trades per day: 1.7
    History: 30 days

  12. It looks to me like we have a double bottom on 3 min dow and 15 min FTSE,but the Dax is just gaining slightly off the bottom of a trough,very interesting stuff for me to learn this.

    1. Unless you’re trading it dedicated, the DAX fades into the background as a FTSE influence between 14.30 and the close for me. The DOW’s in charge with some local closing variables for us till 16.30.
      And I have a nasty feeling I’ve got it wrong…..

  13. To use a tmfp phrase which I like,it looks to me like all this unpredictable volatility is to close out the weak handed longs,I might be a mile off but it’s just my view.

    1. Probably overthinking it a bit there anstel, my view is it’s a holiday time with low volume and no discernible pattern since yesterday’s price marking up rally from the DOW.
      It’s like driving an old car, you hear a new rattle or squeak and think it’s falling to bits. It isn’t, it’s just another rattle.

  15. Here’s a little prediction based on a hunch nothing more,I reckon when the Ftse closes the Dows going up :0)

      1. I think it has been well supported. I’ve been with the kids today but it was 25 down when the DAX was roughly 40 down. That has dropped another ton

        2. That Ftse long closed at 58.4, made 52 points,thought the year end close would have been 6320 plus,never mind out at a profit,Don’t want to risk it dropping at this late stage with only half day tomorrow. Good night all :0)

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