Support 6710, 6690, 6678, 6608, 6576 Resistance 6741, 6759, 6770, 6813

Good morning. I hope you had a good weekend. Yet another emergency summit in the ongoing Greece saga, with Greek Prime Minister Alexis Tsipras presented a new plan to stave off default before an emergency summit Monday that could decide his nation’s future in the euro. The new offer “was a good basis for progress at tomorrow’s Euro summit,” European Commission spokesman Martin Selmayr, said in a Twitter posting. He also referred in German to the inception of the plan as “birth by forceps.” The euro strengthened in Asian trading. Panicked depositors have withdrawn more than 30 billion euros since December. Without a deal, Greece faces the specter of capital controls and what U.S. Treasury Secretary Jacob J. Lew said would be a “terrible” economic decline.

With the clock running down on a June 30 deadline to make payments and work out a new aid deal after months of fruitless negotiations, Tsipras will have to convince the country’s creditors that he’s ready to compromise on election promises and avoid a default. With its finances in tatters and banks bleeding deposits at record pace, it’s unclear how long Greece can hold out without a fresh infusion of rescue loans. In phone calls Sunday, Tsipras briefed German Chancellor Angela Merkel, French President Francois Hollande and Juncker on Greece’s proposal to unlock bailout funds, according to a separate statement from his office.

US & Asia Overnight from Bloomberg
Asian stocks rose ahead of Monday’s European emergency summit on Greece’s debt crisis.

The MSCI Asia Pacific Index added 0.3 percent to 147.66 as of 9:06 a.m. in Tokyo after sliding 0.7 percent last week. E-mini futures on the Standard & Poor’s 500 Index jumped 0.4 percent ahead of the meeting, which is seen as a last-ditch attempt for Greece and its creditors to devise a bailout deal.

“The U.S. market seems to be reacting somewhat positively to the new Greek proposals,” Shoji Hirakawa, chief equity strategist at Okasan Securities Co. in Tokyo said by phone. “Deadlines may be extended in order to discuss the new proposal, but it doesn’t appear to be ground-breaking.”

With the clock running down on a June 30 deadline to make payments and work out a new deal after months of fruitless negotiations, Greek Prime Minister Alexis Tsipras will have to convince the country’s creditors that he’s ready to compromise on election promises to avoid a default. In phone calls Sunday, he briefed German Chancellor Angela Merkel, French President Francois Hollande and European Union Commission President Jean-Claude Juncker on Greece’s proposal to unlock bailout funds, according to a separate statement from his office.

JPMorgan Chase & Co. said the the impact of Greece being ejected from the euro probably wouldn’t rock world markets, and the fallout in Asia is unlikely to spread beyond an initial kneejerk reaction, according to Australia & New Zealand Banking Group Ltd.

South Korea’s Kospi index gained 0.8 percent, while Japan’s Topix index climbed 0.5 percent. The Japanese gauge has fallen for three straight weeks.

Australia’s S&P/ASX 200 Index slipped 0.1 percent. New Zealand’s NZX 50 Index was little changed.

Markets in China are shut Monday for a holiday. The Shanghai Composite Index tumbled 13 percent last week, its worst weekly selloff since 2008, amid concern valuations have been pushed to unsustainable levels. [Ref]

FTSE Outlook

FTSE 100 Prediction
FTSE 100 Prediction

We are near the top of the 20 day Bianca channel as I write this with resistance at 6741, and the 10 day not much higher at 6759. We also have the 2 raff channels around this 6745 area so trying a short off these daily channels to start the week looks to be worth a go. There is also a declining 30minute channel with resistance at that 6741 so I am thinking a short from here down to the daily pivot at 6710 (weekly at 6706) before a bit of a bounce. As per usual a lot will depend on Greece and a rumour (or leak) one way or the other will probably have quite a dramatic effect. On the bullish side, if we break above these clustered daily channel resistance lines then a rise to 6770 where there is a rising 30min channel is possible – that channel tallies with the 2 most recent highs. I have gone for some bear at the 6745 area, and the daily safe zone has the stop level at 6770 so for a safe stop on a daily short that would be a good stop level based on that, or just above in fact so that the 30min channel could play out. Things certainly look quite positive to start the week so it appears markets are pricing in a positive and hopefully final, resolution to the Greek issue.

72 Comments

    1. Yep, resistance levels busted on the daily channels. Be glad when Greece is decided one way or the other!

        1. what was said yesterday such that it shot through the roof? I obviously missed it, all I heard was they spend the day working hard to find a resolution. big deal.

          1. This isn’t a traded rally, more of a low volume mark up.
            High risk/low reward either way for me with this sort of price action.
            Just taken a reluctant small long at 89, I’ll give it 10 minutes or 5 point stop.

          3. (sounding very dumb) what exactly is a low volume mark-up in comparison to traded rally. I assume low volume is little trading, does this mean prices are just correcting?

          4. It’s a revaluation of prices without any trading action to back it up. This is why people look for gaps to be filled (obviously not on 24/7 markets, but physical ones).

  6. 9:04 am
    RSI Divergence on smaller time frames.
    FTSE Looks fully priced ..for the time being…at 6802..
    9:23 am
    FTSE 6787 Reaction retracement
    FTSE Range 6775 – 6810
    I think we’ll just kick around in this range until US Open or until further news.

      1. Oversold 1 and 3 min rsi, that’s why I bought anyway.
        It hit <20 1 min, micro bounced, then retraced to 89 without setting a lower rsi, which is a buy signal for rsi scalping to me.

        Long again 90 same stop

          1. Hi sorry just to understand what do you mean by not setting a lower rsi. I saw rsi drop to about 17 at 9.19, bounce up to 27 at about 9.20 and then 24 at 9.23. At the same period the price went 6792 then hovered to 6789. thanks

          2. I’m using 10 period but it’s the same action.
            The initial 9.19 sell off hit the lows for rsi and price (long candle can signal that a reaction is coming), then the bounce in both, then the test of the price low held with a higher rsi and the rally started.
            Of course you run the risk of the down trend continuing at 9.23, but you have the original 9.19 price low on which to base a tight stop. Good risk reward in a ranging market like this morning.

      2. Milka
        9: 23 Reactionary retracement of the highs.
        Each action creates / has a reaction.
        The retracement from 6806 to 6788 is a reactionary retracement.
        The retracement from 6788 to 6801 is a reactionary retracement.
        Note that this wasn’t a full retracement to the high (6806) – so we have a Lower Hi.
        Still in an uptrend until the low 6787 is taken out.
        Trading patterns. Trading ranges & Oscillations around the MA.

          2. Not disagreeing with you, but you could also say that there’s a lot of pessimism in the price too, seeing as we’re ~300 off the highs with Greece arguably the main reason.
            That’s why I don’t like trading based on news analysis, how do you price its value in points?

          2. That’s a shame, looked a good shout.
            Tipping point here, silly bit of ‘news’ is all that’s needed for a bit of gap filling imo.

          3. I closed it anticipating a stop hunting spike to 430 so I could short from there. Now its gone..missed the long this morning waited to short and missed that one as well. Ah well, will wait for next opportunity !! I will wait for a retrace to 360 and short from there. Lets see.

          4. Don’t worry about it, you’re not alone…kicking myself for not shorting the 800 fail on the ftse 🙁

          5. It was a nice risk/reward setup I always go for. I win big only when I’m not looking at the trades after I execute them with a stop of course otherwise either I close it prematurely or for a loss before hitting my stop.

        2. It’s hard. the market is like a bucking bronco. Almost everything it does is designed to get you out at a loss

          1. On the other hand if it gets to 231 first, I will take a long. Should I short again now with a 10 point stop ??

  8. Anyone looked at the greece25 market on IG. The number of gaps is unbelievable. Could it be the bottom of the trend? That is the question…..

    1. LOL, that’s a total gamble. Problem is, if the talks goes t*ts up, it will probably be untradeable.
      I see IG’s guaranteed stop is ~9% of TOTAL index value i.e. equivalent of a 600 point FTSE stop.

  13. A bit of Zerohedge FUD for you news hounds:
    “Speculation is rife as the Eurogroup announces a much earlier than expected press conference. The exuberant expectations “priced in” to markets are fading fast as traders fear the short nature of the meeting combined with dysphoria from Schaeuble suggest no deal is close and new Greek proposals remain far from adequate for its European “partners.” Local reports suggest this brings into doubt whether this evening’s EU leaders’ meeting will go ahead.”

  14. European markets feel right in the middle here with ftse either at 6600 or 7000 this week. Just entered and S&P short which is close to it’s highs. Don’t forget the selling of the news into the summer.

          1. and out at 25
            That was ironic doncha think, BB, it finally gets to 6820 and you’re short and I’m long lol.

  19. The other indeciies are pushing forward but FTSE trickling down. I’m not complaining but VERY Strange.
    is 6815 top

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