Support 6695, 6677, 6670, 6646, 6626 Resistance 6736, 6746, 6795, 6815

Good morning. Well I just wasn’t patient enough with that 6675 long, it looked weak for most of the day since the order took then finally took off to a high 6725 though has since dropped back. Bit of caution needed today as its NFP Friday, though I have a feeling we will rise unto and possible on the news. If the bulls manage to break the 6725 then 6736, 6746 are attainable, though the 10 day trends, both Raff and Bianca are heading down now – tops at 6770 and 6736 respectively. ECB news yesterday was basically a No to QE now, though reassess in the New Year. The BoE unsurprisingly left interest rates and also their asset purchase unchanged. NFP is forecast at 230k versus 214k previous.

Asia Overnight from Bloomberg
Asia’s regional benchmark index was little changed ahead of a monthly U.S. jobs report. Materials shares led declines, while consumer companies advanced.

The MSCI Asia Pacific Index (MXAP)slipped less than 0.1 percent to 140.68 as of 9:01 a.m. in Tokyo, before markets opened in Hong Kong and China. Fortescue Metals Group Ltd. slid 4 percent in Sydney. The Asian equity gauge is flat this week, with investors looking to today’s U.S. payrolls data to confirm that the American recovery is on a strong footing.

“The release of the U.S. jobs figure is likely to dictate caution amongst traders,” said Ric Spooner, Sydney-based chief markets analyst at CMC Markets Australia. “While the U.S. economy continues to expand at a moderate pace, there has been some patchiness in recent data including consumer confidence, personal spending and durable goods orders. Against that background, markets will be looking for assurance that the momentum of jobs growth is being sustained in the U.S.”

Today’s payrolls report may show U.S. employers added more than 200,000 jobs in November for the 10th straight month, while the jobless rate held at the lowest level since July 2008.

Japan’s Topix index retreated 0.1 percent and Australia’s S&P/ASX 200 Index gained 0.2 percent. New Zealand’s NZX 50 Index and South Korea’s Kospi index were little changed.

Futures on the Hang Seng China Enterprises Index of mainland firms listed in Hong Kong added 0.5 percent. The gauge has climbed 3 percent this week and closed yesterday at the highest level in a year.

The Shanghai Composite Index (SHCOMP) surged 4.3 percent yesterday, extending gains to 19 percent over the past month, the most among 93 global equity indexes. The rally, which has coincided with increased use of leverage, is spurring mainland investors to open share accounts at the fastest pace in three years and sending trading values to record highs.

U.S. Futures
Futures on the Standard & Poor’s 500 Index were little changed after the underlying gauge slipped 0.1 percent, falling from an all-time high.

European Central Bank President Mario Draghi said yesterday the region’s central bank will reassess stimulus next quarter. Draghi’s comments damped speculation the central bank was poised to start a program of sovereign-debt purchases known as quantitative easing after policy makers kept interest rates unchanged.

The ECB’s Governing Council expects to consider a package of broad-based asset purchases including sovereign debt next month, two euro-area central-bank officials familiar with the deliberations said. [ref]

FTSE Outlook

FTSE 100 Prediction
FTSE 100 Prediction

So, NFP here again with a 230k forecast, released at 13:30 so likely to be pretty choppy around then. I have a hunch that buying the dip and holding it today might be a decent play. We have the daily pivot showing support at the 6695 area where we currently are, though it does feel like things are weakening – or rather just slowing down early December for a push towards the end of the month. The bottom of the 10 day channels are at 6646 for the 10 day Bianca, 6677 for the 20 day Bianca, 6652 for the 20 day Raff and 6620 for the 10 day Raff. So some decent daily support at 6650 as 2 match up at that level. If that breaks then 6620 and possibly lower – 6580 maybe are the next areas to watch.

Resistance today is initially at yesterdays high at 6725, with 6736 top of the 10 day Bianca above that. 6746 is next after that. i realise I am throwing a lot of numbers out there today but the chop from the last 2 days has made the charts a bit messy for me, so just to sort the main levels out, resistance is 6746, support 6669 for today.

37 Comments

  1. What a day yesterday….does ECB have any credibility?
    First ECB says no QE around 1.30 and there after market crash following almost 100pnts up for DAX, then almost 200pnts down.
    I am so glad I closed off early and left happy with my profits for the day 🙂
    Later what happened? A spike up again – or shorter’s gets another chance? Suddenly someone says ECB preparing for QE in Jan….really someone is dragging this on….
    Anyway someone left a comment on Marketwatch, that some bankers rumoured that ECB preparing for QE in Jan, he also mentioned maybe to quickly recover his losses. Those rumours did spike things up around world….
    Anyway German seems to have stabilised their economy from further falls, now would they want QE in JAN? I don’t think so! I suspect these rumours will be doing the market some spikes up and down for sometime, and I doubt any QE in Jan…so be safe and prepared for rumours either way…

    I tried something new today, shorted DAX again, thanks guys who pushed it well up again, and I hedged with a long as well…does anyone use that strategy here and what’s your experience and feedback on that? I am already plus on that 🙂

    2. ‘I tried something new today, shorted DAX again…and I hedged with a long as well…does anyone use that strategy here’
      What do you mean Mali, ‘hedged with a long’, you mean you bought FTSE or DOW against a DAX short? I do that sometimes.

      1. I had a short for Dax, however as wasn’t sure how high it will go, and thought it might push up a bit more, added a same DAX long on same platform ie a hedge trade on same index.
        Obviously hedge between indexes is common and used it many times, but on some index – this was first time I tried it.

        1. Oh, ok, you mean e.g. say you were 10 short but you thought it might go up a bit, but instead of closing half the short, you buy 5 separately?
          What’s the difference, you’re still 5 net short?

          1. Well I made some money while it goes up, as I closed the long now, rather seeing a bigger loss 🙂

  2. Kinda going on what I said in the last few blog posts, that it can be spun either way, I prefer to sit out on big days like that.

  3. I’m short. As always… Bit of a nervous bear today though. Mainly because i don’t want to undo all of my hard work.
    Short @6710 @6730. Making 00-50. Might bid for 2 offer in 1 again to get myself level and relax and enjoy the weekend.
    Good luck all.

    1. Yes, Mlawrence01, we had a very good day yesterday!, and don’t expect my luck to be that good today, hence more cautious trading today and whatever happens should be ok today, as playing it more safe…
      I do expect usual spike at 1.30pm, then US will decide rest of direction today, either rally to 18,000 or down to 17800, I think later this afternoon. GLA

  4. Guys, you know what happened?
    I switched off my screen for 30min, come back and see a trade placed for DAX buy at 9979@£50/pnt – wow!!! In my account!!! taking all my margin and I did not trade this!!!
    I called CS and they still trying to sort it, although showing as profit now, it wasn’t my trade, hence worrying! They did say they will sort as they can see a back office error! I just wonder what’s happening? Half million Euro buy of DAX in error???
    Have you experience this?

    1. If by CS you mean `Capital Shares` that platform is a nightmare especially when it comes to stops.

      1. Sorry meant Customer Services, yes I thought of that after writing, but can’t edit.

        Maybe it showed what the professional were doing, they told me it was back office error of some hedging..??? Something fishy – I wana know more, because I am trading my hard earned cash and have a right to know how this works…am I being watched from yesterdays gains? I wonder…

    1. That’s good level Nick, I didn’t get it, as was too quick.
      Anyway US jobs numbers very good, 1st quarter next year, further FED tightening on cards as well as ECB loosening – it should be interesting start to the year…GLA

  8. “The November job report was strong but it is not a sign that the Federal Reserve is behind the curve on hiking short-term interest rates,said Loretta Mester” [Marketwatch]
    Does it imply some of FED beginning to feel that interest rate should have been increased already? Also mean Q1 2015 – possible for first rate hike…and surely UK will follow US, few months later?

  9. Short just misses by 0.00000001 as always and look what happens. Costing me a lot of money!

      1. It adds up when it’s about the 10th time it’s happened in a week. And even more frustrating when the market actually gets there!
        Based on my book i would close @30

        1. And i would close my current short in my book @30 back at 30 leaving me with my highest sale @50 still.
          So yes it could cost a lot of money.

          1. I mean you didn’t lose, you just didn’t earn or win whatever you prefer. Better luck next time.

          2. besides I don’t see any reason to short at the moment. I know any spike may give you some points if you short on the top but generally it’s going up now why short?

      1. No big trades, was scalping some points below that 36 in the morning. now shorting @46. All closed now

  11. Looks like the guy who put that order for DAX @9979@£50/pnts, knows what he is doing, see DAX now, he must be happy! Strange how all recovered today and much higher…

  12. Annoyingly now though. If i closed 1@30 i would have made 10-60 and got short 10 points higher than i am now (if it gets to 60)

  13. I wouldn’t like to be long over the weekend up here. Who knows what can happen at the weekend to hit it on the head.

  14. Markets are all hitting new highs. Yes they might keep going but it always zig-zags whether it’s going up and down. And what we might keep going 100 points? Even i feel it might reach 6850?
    The bigger risk still though is it suddenly clunking 300-500 points.

    1. long booked, but not sure where DAX is heading now..
      DOW 18,000 is just few points away and traders in US will wana take it there…
      At this levels I wonder where Santa heading this year? FTSE just so slow…

  17. I remember a large company on Bloomberg mentioning that this year around S&P 2079, they plan to take some longs off the table…and thought it would be a SELL then, looks like we hit that just now…DOW 18,000 almost now, few more points…

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