The FTSE continued its rise yesterday and broke through the key 7480 resistance area to test 7500 where we had that fib level. The bulls couldn't push any higher than that, despite the US rising to a fresh high at 2668 not the S&P 500. Overall it was a pretty flat session for the FTSE with just a 40 point movement. Gold didn't fare well, continuing to decline through the 1240 support, though it has bounced back overnight.
Traders will be staying by for news from the Fed today to see if we get another rate rise before the year end, after their meeting today. We also have the ECB tomorrow with further QE tapering expected to be announced, and the BoE also tomorrow.
With the FTSE climbing from 7300 in what looks like an early Santa Rally, the daily chart has gone bullish again, with support at 7412 so any dip down to around this area is worth a long for further rises next week as we head towards the holidays. The is still a likelihood that we get a bit of a dip back down today/tomorrow, especially with all the central bank outcomes due, and we also have option expiry on Friday. The bulls will be looking for a run at 7600 and closing the year out strongly, while the bears will be aiming to get the price initially below 7480, and then 7412.
For today I am thinking that again we will get a dip in the morning and then a rise. The dips so far this week haven't gone that far though - 7412 on Monday, 7460 yesterday and then a slow rise. The ASX (Australia) put in a V shaped day today and I am thinking that we will do the same. There is early support at the 7480 level again, with 7423 below that, and then that daily one at 7412 mentioned above.
The US markets fell on that Alabama Senate election result, which saw the Republican majority reduced, and the S&P dropped off its 2668 high of the day. That decline may well continue a bit today, depending on the Fed later.