Support 6749 6745 6740 6730 6716 Resistance 6770 6774 6796 6801 6949 6956

Good morning. Nice little long yesterday though the bullishness was fairly short lived and 6840 proved a bit too optimistic! Apple missed with its results last night, along with a record loss for Microsoft, so we have had overnight weakness though none of it is unexpected really, as a pull back is required to the 25ema on the dailies of the various indices. 6716ish for the FTSE, 2100 S&P and 11400 Dax I am looking at for support.

US & Asia Overnight from Bloomberg
Asian stocks fell, with the regional benchmark index retreating from a two-week high, as technology-related shares declined after companies including Apple Inc. and Microsoft Corp. reported disappointing results.

The MSCI Asia Pacific Index fell 0.5 percent to 144.56 as of 9:08 a.m. in Tokyo. U.S. equity-index futures slipped as Apple tumbled more than 6 percent in extended U.S. trading after missing analysts’ estimates for revenue and iPhone shipments. Microsoft fell 4 percent on its record net loss.

“Markets are going to get more volatile,”said Nader Naeimi, head of dynamic asset allocation at AMP Capital Investors Ltd. in Sydney. “The earnings season in the U.S. is going to be quite weak. Investors are expecting too much from Apple, and that’s already reflected in the share price. How much more improvement can Apple deliver unless they introduce a radically different product from what competitors like Samsung are offering?”

Japan’s Topix index fell 0.9 percent. South Korea’s Kospi index slid 0.5 percent. Australia’s S&P/ASX 200 Index dipped 0.9 percent, while New Zealand’s NZX 50 Index added 0.4 percent. Markets in China and Hong Kong have yet to open.

The Shanghai Composite Index advanced for a fourth day on Tuesday, finishing above 4,000 for the first time since July 1 and capping its longest stretch of gains since May. Smaller companies extended a bull-market rally and speculation grew the government’s market-support measures have contained excessive price swings.

U.S. Futures
The Chinese benchmark has rebounded 15 percent since July 8, following a month-long rout that cost shareholders almost $4 trillion, as policy makers introduced a spate of measures to bolster equities. The Shanghai index on Monday posted the smallest price swings since the rout began.

E-mini futures on the Standard & Poor’s 500 Index dropped 0.4 percent. The U.S. equity benchmark index retreated 0.4 percent on Tuesday.

The S&P 500 had rallied 4 percent since a low on July 8, reclaiming almost all of its losses that stemmed from worries over Greece’s debt crisis and China’s market rout. The easing of those tensions sparked the Stoxx 600’s rally that added 9.1 percent and pushed it to within 2 percent of its record.

European Central Bank officials are holding a telephone call on Wednesday to discussthe Emergency Liquidity Assistance that keeps Greece’s financial system alive. They’re about to send a team back to the Greek capital to monitor compliance with austerity policies that the government accepted in return for a bailout deal. [Ref]

FTSE Outlook

FTSE 100 Prediction
FTSE 100 Prediction

We have a few supports around the 6740/6750 area where we are as I write this at half six, so I think we may get a bit of a rise initially from this area. most likely towards the 6760 area. If that holds as resistance then we should be on for a dip down to the daily supports across the board on the FTSE, Dax and S&P. As mentioned above I am looking at the 25ema on them for possible swing longs. Todays pivot is 6770, and just above that 10min channel that I have used for the arrows; that said we also have the 200ema on the 30min at 6774, with the T3 trend line at 6770 so there is a cluster of resistance around this area. Everything is looking fairly bearish to start off with today.

80 Comments

  1. Although the bear is pleased, I’m not quite sure why we are so comparatively weak this morning, so been buying dips which is working out OK atm, but the touted support around 6720 seems to have turned into a lid on things.
    If we close that big overnight gap I’ll be surprised.
    DOW will be interesting this pm with their Apple fixation.

    Currently short at 21, 10 either way.

  2. Technically the FTSE feels as though it needs to put in a higher low before propelling itself beyond 6815. There is an extreme daily gap at 6595 (plus a candle gap on the daily at 6553). Daily pattern looks quite similar to the mid-Dec to early Jan daily candles. We did a 61.8% retrace before going higher then. 61.8% retrace would take us to about 6575. Could it be similar this time?

      1. No charge for the pearls of nonsense 🙂 Of course the market will do what it wants – if only it would always follow a logical course! Until my 2-hour bull signal wakes up the bear is happy to go fishing.

  3. Morning I really don’t feel comfortable being short for some reason although the sma’s are all indicating weakness ummn

    1. Taking a position that you don’t feel comfortable with isn’t a bad thing.
      Ignore the mind, look at the numbers.

    2. Am I right in thinking there’s a reasonable amount of support around the 7000 area where we are now? It looks like it on the daily chart to me.

      1. I think 6690ish may be a cautious buy short term, simply because it’s oversold, but all I see on the daily is 6660/40/20.

      1. It had just dropped to about 6698 ish i think when i submitted the post to the best of my knowledge because im long from 17 and i was down alot more than 3 points

          1. Ive not been short at all tday,lost on my long yday.but my long from 17 im going to hold as long as i can,its my belief that this market will go up one more time before it tanks bigtime.Thats just my belief and i trade my beliefs sometimes wrongly.

          1. “anstel says:
            July 22, 2015 at 10:14 am
            Morning I really don’t feel comfortable being short for some reason although the sma’s are all indicating weakness ummn”

            @10.14 the 1 min range was 6712-14.
            But it matters not, we’re nearly back to 6700, might get to 10 before DOW opens.

          2. Hey no worries tmfp,all i was trying to say at the 10.14 post was i’m not comfortable being short.im thinking longer term than you i think.I like to have a laugh as much as possible and keep my trading as relaxed as i can. But as you are aware the markets are not all about technical analysis and news.I also dont like using stops which is against all conventional wisdom.i try to trade without fear if i can.

          3. Sure.
            The point you make about stops is interesting.
            Say, using whatever my method is, I decide to buy at 500 because I think it’s going to 530.
            I accept that it’s not going to go up in a straight line, so I’m not fussed when it goes to 490. But then it goes to 480. Then 470.
            At what stage do I admit that reasoning behind my original decision no longer valid?
            If I think it is still valid, do I double up at 470?
            Then it goes to 460, 450……
            Also, risk/reward ratio.
            You”ll often see me say “10 either way” i.e. 1:1.
            To me, that deal is done, over with, let the chips fall where they may. I make ~68%.
            Also Black Swans/bolts of lightning do happen. Non guaranteed stops are not 100% protection, but better than nothing.
            Sorry for the long post, but I think it’s important.
            Just like in real life, admitting you are wrong and limiting the fallout is essential.

  4. Daily rsi10 is now below 50. Every time this has happened this year it’s led to usually 2-4+ more days of pull back (minimum was 1 more day). My daily tsi never got to above 0 on this latest 7-day rally and is now curling south again (just like in Dec-Jan).

    1. Sorry you lost money, watch it go straight back up to 6800 now #notfunny.
      I don’t mean to come across like a patronsing c**t, but I have been there, done that.
      Once you start the process of exit strategies on both sides when you open a trade, your dealing will be more balanced and improve.
      GL.

      1. Thanks tmfp.do you know what,there has not been one trade ive lost on that wouldnt have turned profitable if i had had the balls to hold it a little longer,i have about an 80% success rate then i blow it every bloody time but i dont do giving up

        1. Hey, I don’t want to turn this into a big thing, but there’s two points to make there.
          Let’s take your earlier long at 6714:
          1) There’s no doubt at some point in time that the FTSE will trade above 6714 again. Until it does, your trading will be influenced by your – long position. Some people “hedge” and have longs and shorts open at the same time to get round this. I keep it simple, either long or short.
          2) Hindsight is a wonderful thing but dangerous. You can look back and say those trades finally came good, but you can’t say whether or not you would have taken the profit at the time.
          What about an innocent long at 7000 only six weeks ago?

          1. I really appreciate all comments tmfp thankyou,my long was from 6717 earlier if we need to be spot on,and what you say is dead right.i have used hedging alot i usually have a long on ftse then i get the dividend towards finance charges and hedge with a short on a contract but i only do that when the market is higher,its also a great way to get out of a points deficit if the market moves to a different trading range.What you say about my trading being influenced by preconceived ideas about where the market was and that it will get back to it is a mental state of mind that i know i need to breaks,thanks for all your help tmfp Zigzagger and all Good Luck.

      1. I think overall there is quite a high probability, but it’s not definite. Quite often on a Wednesday you can get a 61.8% retrace of the high-low for the day. The trouble is working out where the low is! I think before going short I’d wait and see if we get this kind of retrace first and and then consider going short. (You could then use today’s high as your stop if you do go short). The retrace may happen this afternoon/evening or possibly Thursday morning. I am short from 6750 looking for 6600 by Friday though I suspect we may bounce from 6630-6640 first.

  15. So, if everyone’s up for it, the Charity Sweepstake for the LSE FTSE closing price, £10 to charity for the worst guess, cut off 16.00.
    Place your prediction here folks (including Senu) 🙂

    2. I pulled a hamstring yesterday trying to catch up,the vet says I need to rest up and just trot around the paddock 🙂

      1. lol I was only looking for 10, missed it by a couple. Keeping it with a 4 pt stop for a little while.
        FTSE’s looking quite strong really, if the DOW can get in the black your guess is looking good.

          1. I’m in @666 Senu 🙂
            Thinking is maybe down to 60ish then bounce. Looking to short a break of 70.

    2. Got there in the end took 10, so long as we stay above 70 still looking ok, DOW’s a bit of a worry though.

  17. Hey tmfp I reread your earlier post at 12.43 about stops and a later one about exit strategies. I have brought my stop up on my long to 63 just a tad above break even thanks

    1. Cool. Stop placement is a balance between money and technical.
      When you place one, ask yourself, would I do that as an opening trade?
      In this case, would I go short at 63?
      If the answer is no, then it’s purely for financial reasons and is more likely to piss you off by being triggered and then reversing, as it has no technical justification.
      But, you’ve stopped a loss and there’s always another trade.

      1. Well no I wouldn’t short it at 63 but I don’t want anymore losses today.im mentally tired now so it’s either out for nowt or profit.I appreciate your help thx.

          2. Would make more sense technically below the previous low, say @49.
            You’d be super pissed off if 51.7 held.
            No more lectures 🙂
            Catch you tmrw.

  18. OK, not waiting for the 4 o’clock bell — looking for support around 6670 and a little upturn to 6680 by close of play. 😀

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