Support 6847, 6825, 6800, 6753, 6746 Resistance 6907, 6935, 6973, 7045

Good morning. Turned into one of those annoying trending days yesterday on the FTSE which I thought it would when that 6815 short got stopped out. The Dax was actually a better one to trade; as well as gold dropping off the 1285 resistance level mentioned. The rise yesterday was attributed to Greece and though I was bullish for Monday and Tuesday (Bearish for today) I didn’t think it would be a rise like that. Anyway, today is a new day and sometimes its good to just sit on the sidelines. We just pinged the top of the 10 day Bianca last night at 6907 and have hovered close to this level overnight. The S&P is at the top of its 10 day Raff and the press is all quite bullish. Signs for a pullback and then further rises – I wouldn’t be surprised to see 7000 in February.

Asia Overnight from Bloomberg
(Bloomberg) — Asian stocks headed for the biggest gain in six weeks and emerging-market currencies strengthened after a three-day rally in commodities. Australian bonds plunged.

The MSCI Asia Pacific Index gained 1.6 percent by 3:18 p.m. in Tokyo, as sub-indexes of materials and energy companies surged more than 2.4 percent. Standard & Poor’s 500 Index futures fluctuated. U.S. oil slipped 1.1 percent after a four-day, 19 percent rebound through yesterday, its biggest such rally since January 2009. Malaysia’s ringgit rose and China’s yuan jumped. The rate on Japan’s 10-year bond rose three basis points and similar Australian yields jumped by the most in 19 months a day after the central bank unexpectedly cut rates.

Global stocks have erased 2015 losses this week as energy companies jumped amid speculation that crude prices may have found a bottom and as Greece softened its stance on a debt writedown. Oil is paring gains before data Wednesday that may show stockpiles in the U.S. rose last week. A gauge of China’s services industry expanded at the weakest pace in six months before similar measures in Europe and the U.S.

“There are still underlying issues out there, but the market is choosing to ignore it right now,” said Matt Riordan, a Sydney-based portfolio manager who helps oversee about $7.5 billion at Paradice Investment Management Pty. “When push comes to shove, it’s all about central banks at the moment. When the oil supply report does come out, it will potentially cause quite a bit of volatility. To try and see where the price is going from here will just be guesswork.”

Japan Surge
Japan’s Topix index rose 1.8 percent, gaining for the first time in three days. Mitsubishi UFJ Financial Group Inc. shares surged 5.2 percent, the most since June 2013 after Japan’s largest bank reported an unexpected 36 percent gain in third-quarter profit. Toyota Motor Corp. added 2.4 percent before reporting earnings that beat estimates.

Australia’s S&P/ASX 200 Index climbed for a 10th straight day, extending its longest rally since August 2013 and heading for its highest close since May 2008. BHP Billiton Ltd., the world’s biggest mining company and Australia’s top oil and gas producer, capped its biggest five-day gain since 2009. Fortescue Metals Group Co. jumped 8.9 percent to lead gains among Asia-Pacific materials shares after the Bloomberg Commodity Index jumped 5.3 percent in the three days through Feb. 4.

Energy stocks drove gains in the S&P 500 Tuesday, with the benchmark U.S. gauge rising 1.4 percent. Exxon Mobil Corp. and Chevron Corp. jumped at least 3 percent to pace a 1.8 percent advance in the Dow Jones Industrial Average.

Brent Bull
West Texas Intermediate oil dropped to $52.49 a barrel today. The U.S. benchmark contract touched its highest level in a month yesterday. Brent, the benchmark for more than half of the world’s oil, finished more than 20 percent above its Jan. 13 settlement on Tuesday in London, the common definition of a bull market.

U.S. crude inventories probably rose by 3.25 million barrels last week, according to a Bloomberg News survey before the Energy Information Administration report. It will be a “long time” before oil returns to $100, according to Bob Dudley, the chief executive officer of BP Plc, which pledged to cut about $2 billion of planned spending in response to the drop, mirroring similar moves by competitors including Chevron.

Japanese government notes due in a decade retreated for a third day, with the yield climbing to as high as 0.385 percent. The country’s 10-year bond rate rose above that of similar German notes for the first time ever yesterday.

U.S. Inflation
U.S. Treasuries were little changed after the biggest rout in 14 months on Tuesday. A government report this week will show wages are rebounding, economists estimate. Quickening inflation would remove a hurdle for the Federal Reserve as it considers raising its benchmark interest rate from close to zero. The rate on notes due in a decade rose one basis point to 1.80 percent today.

Australia’s 10-year yield surged as much as 20 basis points to 2.48 percent, the biggest jump since June 2013, erasing yesterday’s drop that followed a surprise interest-rate cut by the country’s central bank.

Malaysia’s currency climbed 2.3 percent from Jan. 30 to 3.5482 a dollar in Kuala Lumpur as markets reopened after holidays on Monday and Tuesday, according to prices from local banks. The FTSE Bursa Malaysia KLCI Index of shares climbed 1.3 percent and headed for its highest close since November. SapuraKencana Petroleum Bhd., the nation’s biggest oilfield services contractor by market value, surged 6.7 percent, the most this year.

China’s yuan rose the most in a week after the central bank boosted the reference rate to a level that meant the currency had to strengthen in order to stay within its permitted trading band. The People’s Bank of China raised the daily fixing by 0.08 percent to 6.1318 a dollar, which was 2.06 percent stronger than the closing spot rate on Tuesday.

The currency rose 0.19 percent to 6.2462 per dollar as of 10 a.m. in Shanghai, China Foreign Exchange Trade System prices show. The Shanghai Composite Index slipped 0.5 percent, while a gauge of mainland companies listed in Hong Kong climbed 0.4 percent. [Ref]

FTSE Outlook

This week my early plan was bull Monday and Tuesday and bear Wednesday and the fact that we are testing the top of the 10 day Bianca at 6907 and the top of the 10 day Raff on the S&P at 2047 make me think that we will get a little pull back today. Usually after a trending day you get a bit of consolidation though that has been the case so much lately. the 30min EMAs are getting closer together so could easily cross for some bearishness early today, whilst the 10 min has been fairly flat overnight, despite a bullish Asia session. If the bulls break above the 6907 then the next area of resistance is 6935 which should be fairly key, then 6973 above that.

Support wise, we have the daily pivot initially at 6847, then 6825 (200ema on 30min) below that. A move through there will pretty much test 6800 then the 6750 area where we have the bottom of both Bianca channels – and probably a good spot for a long tomorrow or Friday for a resumption of the upward trend going into next week. Don’t think it will be a -140 day today to hit 6750 today.

So, down to 6750, then back up and probably test 7000 next week!