Support 6792 6779 6774 6717 Resistance 6824 6840 6926 6979

Good morning. Nice short off the 6810 yesterday but wow it took a while to generate those 30 points! I ended up closing at 6780 as the S&P had dipped to its pivot which was holding and as I was expecting a climb on that from that level it was probably going to take the FTSE with it. Which it did and we are now back at 6800 as I write this with the chart looking like having a bullish day ahead. Bull Tuesday back in the mix? Greece worries are receding for the moment, though there is still the spectre of a Grexit at some point down the road. The tin can has had another kicking anyway.

US & Asia Overnight from Bloomberg

Bianca Trends
Bianca Trends

Asian stocks rose as a weaker yen buoyed Japanese equities and consumer shares advanced.

The MSCI Asia Pacific Index added 0.2 percent to 144.51 as of 9:01 a.m. in Tokyo. Consumer companies led gains, while energy shares were the worst performers for a second day. Crude oil fell below $50 a barrel on Tuesday, as gold traded near a five-year low.

“This commodities rout is a very big concern,” Michael McCarthy, a chief strategist at CMC Markets in Sydney, said by phone. “There’s risk for a further downside. It looks like the overall global growth outlook is continuing to slow.”

Japan’s Topix index rose 0.5 percent as it resumed trading following a holiday on Monday. The yen traded at 124.35 per dollar, weakening a second day. South Korea’s Kospi index added 0.5 percent. Australia’s S&P/ASX 200 Index increased 0.1 percent. New Zealand’s NZX 50 Index climbed 0.2 percent. Markets in China and Hong Kong have yet to open.

The Shanghai Composite Index climbed for a third day on Monday, rising 0.9 percent after the gauge briefly surpassed the 4,000-point level. A fifth of the market remained frozen.

The Chinese benchmark has rebounded 14 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. China Securities Finance Corp., a state-backed agency that provides margin finance and liquidity to the market, has as much as 3 trillion yuan ($483 billion) on tap to support stocks, people familiar with the matter said late last week.

E-mini futures on the Standard & Poor’s 500 Index dropped 0.1 percent today. The U.S. equity benchmark index added 0.1 percent on Monday in New York as the Nasdaq Composite Index extended its record.

Greece met a deadline to pay some 6.8 billion euros ($7.4 billion) to creditors Monday, as depositors queued at reopened banks in the first signs of normality after last week’s bailout deal.[Ref]

FTSE Outlook

FTSE 100 Prediction
FTSE 100 Prediction

It all looks bullish at the moment for today (6am), and with support at 6775 any dip to this level looks a good long entry. We have the bottom of the 10 day Bianca there and also the 200ema on the 30min chart. I expect that we will break through the 6810 area which have been the most recent highs, most likely to reach the 6840 area today. I have plotted the arrows fairly bullishly so we may not get a dip down to the 6775 area, but instead just follow that 30min channel upwards, but it will be interesting to see if we (a) dip off 6840, and (b) how far. If it doesn’t dip at all there then we are probably going to have an up trending day. The top of the Bianca levels are worth a watch at 6926 (20day) and 6979 (10day).

54 Comments

  1. Not sure I agree with Nick’s bullish forecast. I think the US may pullback as soon as today. NYAD was -1000 yesterday meaning there were 1000 more decliners than advancers yet SPX was up for the day and banged into resistance. Stats suggest they should close in red today, which could pull the FTSE down? Just can’t be sure about the size of the pullback yet and we may of course stay stuck in this 6775-6815 range for a while longer.

    1. I agree now. At 6am it looked quite bullish – green trends, positive moving averages. Now, not so much!

      2. Classic bull trap 🙂 I hate trading Tuesday’s – seems to be the day of the week when I make the most mistakes. Think I’ll stay out today and watch. Oh and tmfp – gaps often don’t work on Tuesday’s either so I’l be ignoring any that appear.

        1. Make up your mind, I’ve just made 10 points on Dax long. I did my long according to Nick’s arrows. EMA and MACD have potential to turn long. Plus the bounce off 11715 area from yesterday really gave me some clue for a long… now is it pivot to break? 11738

    1. The sma’s are not looking very pretty at the moment 🙁 but old bully here is going to hang on 🙂

        1. I still have my 72 long, stop now at 78, trying to forget about it until 6810 at least.
          God, this is boring.
          🙁

    1. Hi Jim, I assume you mean the gap between 6806.7-6804.7 just before 7.00am? The important thing about trading candle gaps is to ignore them outside of cash trading hours and also to ignore gaps of 1 point or more as these can signal a break-away rather than a tradable gap. I went for the gap at 6781 that formed on the 15min candle between 15.30 and 15.45 yesterday. This was a clue to me that the market wouldn’t go up this morning but pull back. The one at 6806 may fill today but it could equally be several days before it fills so I’m not going for it. Staying out today. May get my 2-hourly sell signal later today – we’ll see. Hourly MACD is about to go negative though we can still test highs again when it’s like this, but overall I’m looking for the range to break down rather than up.

  5. Morning all…
    Just looking at the FTSE Hourly
    – noticing it has given up the 50 EMA for the time being. This has been an area of support (see chart link below).
    Would make sense to see one more push higher above 6840..but the only way to interpret the daily, I think, is that we are “consolidating”. (6750 – 6820 area)
    1 Hour Chart attached.
    Right click open in new tab
    http://s44.photobucket.com/albums/f25/FTSEDAYTRADER/Mobile%20Uploads/?action=view&current=display_chartimage_zps72a1d1a8.png

  7. Hi ZZ, The indicator showed that 15 min. 15:30-45 gap OK. Thanks for the interpretation. I shall keep an eye on it!

    1. He’s dozing in the sunshine Senu, might be awake and hungry later in the week, not soon enough to save your short, I fear 🙁

        1. No harm done then 🙂
          Just contemplating a long around 80…why, I’m not sure, somebody convince me please.

      3. My bear is stirring from his slumber and having a sniff around. Might need to chew on a couple more 2-hourly candles, but could be poised to pounce tonight/tomorrow.

  9. The DOW’s looking very weak/oversold do you think? Not a very good performance for earnings season.
    Anyone trade the VIX? Seems cheap around here.

  11. Well, while we’re watching choppy paint dry, anyone want another sweepstake on the official LSE FTSE close?
    Worst guess pays a tenner to charity.
    Latest entry 16.00 post time.
    Is that ok Nick?
    🙂

        1. Come on tmfp only 10mins to deadline.we might have to use a handicap system for late entrants

    2. I’m going to be tactical, use all the time 🙂
      I’m expecting a bounce then further downside…

      1. Just going to give my friends at the federal reserve a call and call in a favour 🙂

        1. Trouble is with the sweepstakes I tend to be more focused on Ftse closing price than my positions!!!!! 🙂

          1. I’ve got a new lighter jockey today and I got a steroid injection from the vets…….hope there’s no blood tests!! 🙂

            1. Its Ok, if you have anything to hide then you can just miss the first 2 blood tests. Just say you didn’t hear the doorbell or something

          1. £10 to RNLI and I’ve sacked my new jockey !!! Are you guys running at the 4.30 tomorrow ? 🙂

  15. FTSE didn’t actually hold up too badly considering the carnage elsewhere.
    A chink of light for the bears, 6660 is around 38.2% fib, then 6610ish for 50%.
    Daily FTSE 10 RSI hasn’t broken 60 since April and held this time too (so far).
    Going nowhere on the upside till we get through 6810 with a bit of zip which would also break that.

    Of course, the DOW could do one of its 200 down 200 up pairs of days and 6760 could look cheapish again. DAX isn’t broken either with the 100 SMA only slightly singed so far today.

    See you tmrw, time for motorbike riding. 🙂

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