Support 6610, 6597, 6551, 6538. Resistance 6619, 6625, 6644, 6649, 6662, 6695

Good morning. Bit of a slow trending day in the end yesterday, which made the 6591 short really struggle – it did dip down to the pivot where I know some bailed out, and was the right place in the end. The Dax held its 9238 support a lot better with a much stronger rise during the day. The FTSE Bianca chart is showing some pretty good strength at the moment with the 10 and 20 day channels rising, though we are nearing resistance at 6644, which is the 200ema on the daily, with 6662 and 6695 above that. The Russia/West/Ukraine issue is still bubbling away, with Russia’s central bank warning that capital outflows will reach $128bn this year and has slashed its growth forecast to zero for 2015 as the ceasefire collapses in Ukraine.

Asia Overnight from Bloomberg
Most Asian stocks rose, with the regional benchmark index heading for its third day of advance, as Japan’s Topix index climbed after the Standard & Poor’s 500 Index extended a record rally on earnings optimism.

Three shares rose for each that fell on the MSCI Asia Pacific Index (MXAP), which added less than 0.1 percent to 140.96 as of 9:04 a.m. in Tokyo. Asian stocks jumped yesterday as regulators in Shanghai and Hong Kong said a trading link between the bourses would start Nov. 17.

“The U.S. market just wants to go higher as earnings have been strong and we’re probably not going to get higher interest rates at least in the next six months,” Evan Lucas, a market strategist at IG Ltd in Melbourne, said by phone. “That’s conducive for higher asset prices. The Shanghai-Hong Kong connect is a very positive event that will allow more foreign funds to flow into China.”

Japan’s Topix index added 0.5 percent. The nation’s current account surplus surged to 963 billion yen ($8.4 billion) in September, compared with analysts’ estimate of 537.7 billion yen. South Korea’s Kospi index was little changed. New Zealand’s NZX 50 Index rose 0.6 percent. Australia’s S&P/ASX 200 Index dropped 0.2 percent. Markets in Hong Kong and China have yet to open. Mainland credit and money supply data may be reported as soon as today.

Earnings Season
Futures on the S&P 500 fell 0.1 percent today. The equity benchmark added 0.3 percent yesterday. U.S. indexes have been reaching records amid signs the economy is weathering a global slowdown and the end of the Federal Reserve’s bond-buying program. Dean Foods Co. rallied 14 percent after reporting profit that topped forecasts.

Cisco Systems Inc. and Wal-Mart Stores Inc. are among S&P 500 companies that report earnings this week. Of those that have posted results so far, 80 percent beat estimates for profit and 60 percent topped sales estimates, according to data compiled by Bloomberg.

FTSE Outlook

Initial resistance is at 6625, which we have hit overnight. If the bulls can break this level then the next levels of note at 6644 which is the 200ema on the daily, then the tops of the two Bianca channels – 6662 and 6695. I don’t expect us to exceed 6662 today, though the 30min chart EMAs are still bullish, and have been since 2am on the 10th November! We have support quite close from the daily pivot at 6597, with 6551 and 6532 below that. The bottom of the 20 day Bianca is at 6492 so the market would need to slip below that level to get properly bearish again. For the moment the trends are up, and with good earnings so far in the US, there might be a bit more of a rise left in the tank. For today, the levels id watch for longs are 6597 and 6538, whilst shorts at 6625 and 6644. There is a pretty decent rising channel on the 30min PRT chart, with resistance at 6649, and support at 6610. I expect a rise this morning then some bearishness at 6625 initially, followed by stronger resistance at the 6645 area.

Support so entry levels for a possible long

• 6610
• 6597 daily pivot
• 6551
• 6538

Resistance so entry levels for a possible short

• 6619
• 6625
• 6644
• 6662
• 6695