Support 6710 6680 6661 6637 Resistance 6721 6748 6758 6766 6829

Good morning. Well that was right to be bullish yesterday but it turned into one of those annoying trending days where it didn’t pull back to a decent long entry and it felt too risky to just hop on the rise. Unfortunately the pivot at 6682 got hit before I sent the email so that order never got a change to take. However, despite hitting the 6760 area, the bulls have been dragged back down, and the ASX has been bearish during their Thursday session – so we may be back below 6700 today. Today is “Super Thursday” – The Bank of England’s Monetary Policy Committee will release its August interest-rate decision, minutes of the policy meeting and new economic forecasts at noon in London. Governor Mark Carney will will hold a press conference at 12:45 p.m. That’s part of a new communications format under Carney and comes against a backdrop of accelerating wage growth and the longest streak of continued economic expansion since before the recession in 2008. Carney set the tone for the event by saying last month the time for tighter policy was approaching.

US & Asia Overnight from Bloomberg
Asian stocks rose, following a rebound in global shares, amid optimism over the American economy. Japanese equities climbed as the yen weakened.

The MSCI Asia Pacific Index gained 0.4 percent to 141.64 as of 9:02 a.m. in Tokyo. The Standard & Poor’s 500 Index advanced 0.3 percent on Wednesday as data showed the fastest pace of U.S. service-sector growth in a decade. Japan’s Topix index added 0.9 percent as the yen traded at 124.80 per dollar after three days of declines.

Traders are bolstering bets the Federal Reserve will raise interest rates before the year is out as the economy appears firmly in recovery mode. Interest-rate futures showed the chances of a Federal Reserve rate increase next month reached 48 percent Thursday, up from 38 percent earlier this week.

“A September rate hike from the Federal Reserve seems to be the consensus among market participants,” said Chris Weston, Melbourne-based chief market strategist at IG Ltd. This “is the first time the market has swung to having September as its base case. It is now clear the Fed’s tolerance of low wages has increased and we’re not going to need to see a dramatic improvement in wage trends before raising the funds rate. This makes the unemployment rate data print the most important aspect in this Friday’s payrolls.”

Australia’s S&P/ASX 200 Index was little changed, while New Zealand’s NZX 50 Index rose 0.2 percent. South Korea’s Kospi index advanced 0.4 percent.

Hong Kong-traded stocks are poised to gain, with futures on the Hang Seng Index climbing 0.5 percent and contracts on the Hang Seng China Enterprises Index, which tracks mainland shares listed in the city, rising 0.4 percent. FTSE China A50 Index futures advanced 0.1 percent in Singapore, while those on the Shanghai Shenzhen CSI 300 Index dropped 1.6 percent.

Chinese stocks traded in the U.S. rose a second day Wednesday, with the Bloomberg China-US Equity Index up 1 percent. The Shanghai Composite Index lost 1.7 percent on Wednesday after changing direction more than 10 times. Volumes on the index are falling amid concern government intervention designed to prevent another stock rout is driving away investors. [Ref]

FTSE Outlook

FTSE 100 Prediction
FTSE 100 Prediction

Today is billed as Super Thursday when we have a load of news out from the BoE, so things might be a little choppy around midday. Mark Carney is also holding a press conference after that. I am feeling a little bit more bearish today than I was yesterday, partly driven by the fact that the bulls haven’t really held onto those gains that well, even helped by a 10 point divi yesterday. The 30min EMAs have crossed over to bear for the moment,, while the 10 min is on a weak bull. As such I expect that we may well see a dip back to the 6680 area, where we have the daily EMAs, the S1 level, and then the bottom of the 10 day Raff at 6663. Todays pivot is 6721 – a little bit too close to the 6710 support to be strong resistance I think, though looking at the 10min a short from the top of that rising channel at 6735 looks like its worth a go. If the bulls break through the 6735 area then the next areas of resistance are 6765 and then 6800, where we have the top of the rising 30min channel, and then we start nearing the top of the Bianca channels at 6820. I think the FTSE might be a bit more cautious today after yesterdays rise.

73 Comments

  1. Funny old thing, trading.
    I’ve been doing it, with breaks, ever since I became a clerk on the LME in 1969.
    Made and lost money for myself and other people, been generally honest in one of the most amoral environments you could find, and had a pretty good life out of it.
    I thought I’d done the whole gamut of emotions, but yesterday at 13.27 was a bit of a moment of clarity.
    As you may know, I have quite a hefty (for me) short position at an average of 6660 and a stop at 6765, potential loss 5 figures.
    I’ve operated nearly all my stops manually for a long time, with 3 X 1 min candle confirms to try and avoid being hunted and sooo, at 13.27 yesterday it’s £10+k click time.
    I’m sitting here waiting for the third candle, finger a couple of mm above the touchpad, will it be green or red…?
    It was red and that’s the high so far. 🙂
    I didn’t sleep well, not because I’m afraid of or worried about losing the money, it just put it all in perspective, the randomness.
    If I do Get out of Jail on this one, some charities are going to have a pleasant surprise.
    🙂

        1. tmpf-
          Your forte is short term trading 1min – 8 hr.
          I’ve found it inspiring.
          Accepting “old dogs – new tricks” and all that stuff.
          What’s with the crystal ball gazing for days and months ahead?
          And then it all comes down to 1 min candles.

    2. tmfp

      yes, i agree with what you say.
      in your particular circumstance regarding your shorts, from my analysis
      it is not looking preety for you.
      this market is going much higher than your stop
      sorry to be a bringer of bad news

    3. My impression is that Carney usually manages to set the markets tumbling — clutching at straws!

  3. So, Super Thursday, data and bullsh*t Day.
    Carnie gets to hold press conferences and release minutes, just like a real Central Banker.
    What have we had so far?
    Month on month Industrial output shrinks by 0.4%.
    Year on year Industrial output misses target by ~50%.

    Obviously a good time to put interest rates up.

  6. Morning All..
    tmpf – We were discussing about RSI 1 min signals yesterday.
    All of those signals have been squared this morning at 6700.

    1. Sorry Typo **
      Morning All..
      tmpf – We were discussing RSI 1 min signals yesterday.
      All of those signals have been squared this morning at 6700.

      1. Not quite sure I know what you mean there Hugh.

        Re: longer term positions, yeah, who knows why we do things?
        I’m still scalping away, the short position hasn’t changed that, glad that I’m developing that early warning system re: pre engulfing candles, saved a lot of money yesterday.

        It’s easy to call “foul” when things are going against you, but those unnatural grinding light volume rises with no pull backs have all the hallmarks of Plunge Protection Squad pre emptive action.
        Rather similar to the DAX. Since the Germans got their way with Greece, it would have been politically unacceptable for the German Stock Market to have shown any negative reaction.
        Look at the DAX daily, 600 up in a week with hardly a pullback. Very natural, not.

    1. LOL – Icarus – I did some trades last week 1 pointers – (bored trades), they worked a treat in range bound markets. I used Tick charts and trade in the direction of which ever average you use. No Stops – just use new trades.

  8. @tmfp and Hugh – just back from holidays and don’t want to start off with a -ve trade 🙂

  9. Good Morning All, hope you don’t me joining in, dabbled last year but unable to commit due to work commitments but im back with more time so hopefully be more successful!???

    Hi Nick you may remember me im based in Cornwall at the hotel however probably not that much monger as we are moving to Norfolk within the next 12 months all being well.

  10. Hi tmfp,

    Was just thinking on you yesterday when the market was hitting 60, I really hoped you weren’t taken out, because it has happened me so many times where they take out then the market turns, by the way I’m short 6776 so looking for a drop aswell.

    Pete

  12. No Senu,

    I will see when it hits 6860 which is possible I think, kind of hoping to get a drop so I can get out 1st tho, but I’m prepared to let it got to 6860 as I think we’re in a overall down trend and this is a short term correction, just my opinion

  13. Back in my danger zone lol.
    That 30 pt + was presumably because of unchanged interest rate?
    Now it’s time to minutely analyse the press conference a la Yellen, I guess.
    DAX not remotely interested despite being more bullish than us earlier.
    MORE BULLETS, I need more bullets! 🙂

    Anyone listening to the Test match?
    🙂 🙂

        2. 12 taken
          A bit oversold atm, maybe a bounce and a look at 42 before an unimpressed DOW opens?

          1. If it does, I don’t see any reason for it stopping there really, lower low and 50% 22/65 rt breached says 22 to me.
            But, while 45 holds, nothing’s broke

    2. Well done Nick, you seem to be doing well this week, I might sign up for your share alert if this short I’m in doesn’t break me:)

  15. A tip I got this morning was to sell 49 with a stop of a break of 1 min bar above 69, not taking it because I dont want to risk anymore

    1. Yes, took 12 on that, tempted to replace it.
      If the DAX gets below 620 and we break 42, a weak DOW could run us right back to 20.
      Patience for 30 minutes I think.

        1. Well done tmfp,

          I wish I had the nerve, I just don’t want to do anything until I get out of this short

          1. It is difficult to double up and average a losing position, Pete, but if you are still bearish and set realistic stops then you should think about it.
            Better to stop it out and start again sometimes rather than go into suspended animation.

    2. Not saying that we are following either the DOW or the DAX, but when the market is ranging and not trending particularly then I think the sentiment spills over from one market to another.

  23. Yea I know what your saying, I’m going to wait and see how tomorrow goes, its just its happened that many times that when I closed a lossing trade the market turned in my direction and I end up down money and buying again around the same price, so I said this time it wasn’t going to happen, I’m not panicking yet, just playing the waiting game.

  24. tmfp

    your opening remarks – ” trading since 1969 ”
    ** experience must be your greatest asset ** as far as your learning
    can i ask you – what has been the most difficult aspect of trading that you have found
    – technical – emotional – trading per se – consistency –
    and ofcourse ” your randomness ” as you said

    1. I’d say probably taking profits too early would be my main recurring weakness pj.
      That’s not a major problem with regard to my current position though 🙁

      1. tmfp
        that came out of the blue !! now you have got me all confused
        been following this board & your statements – really did not see that
        your 65 stop has me all confused

  25. I think us bears are on the wrong market, the Dow is on the floor and looking for the cellar & the FTSE is not interested

      1. Purely buying the shares tmfp. Screener runs, give potential buy price, quick bit of research to make sure no results due imminently or such like, and then just set the orders up.

    1. Yeah, trying hard.
      That’s effectively the equivalent of our 6414 low.
      Next target 17000 if 400 goes convincingly.

        1. Yeah, it’s looking a bit broken across the water.
          Why we’re so strong mystifies me. Obviously.

  28. The same person that told me to short 49 today said the market could go to 6860 before the decline starts again, but sure we’re all experts, by the way he didn’t tell me to go for my 6676 short, that was my own wise move! he said he expected 6750-6860

  29. Just looking at the daily rsi, if you draw a line there is a resistance around 56.4, around the end of April it fell below this line (market top for the year in my opinion) and since then the market has dropped each time it came up to this resistance, it up at it again, so it will be interesting to see what happens now, just something for a bear to be looking for:)

    1. Indeed. That was one of the factors involved in my shorting, but with hindsight, I got it wrong by starting the selling about 50 points too early.

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