It ended up being quite a flat day yesterday, though the FTSE 100 did close at the highest level for 14 years, and still looks like it wants to go a bit higher. That said the short yesterday at 6875 went down to target at 6859, and even hit the secondary at 6849, before bouncing back again.
The bulls are certainly the ones in control at the moment. The daily trends are tracking up still, and the indices seem to be shrugging off most things that might cause an upset at the moment. Interest rate rises are still being mooted, as I mentioned yesterday.
When you do start seeing the headlines in the mainstream media about the FTSE hitting highs and asking "is now the time to go back into the stock market?", it's exactly the time you should be getting out as the smart money has already ridden the rise.
So, though there may yet be a push to 6900/6940, I don't think we are on for a long bull run just yet.
FTSE Outlook
Only one of the trades took yesterday, being the short from 6875. It didn't quite dip as low as the long order at 6840 which was a little bit of a shame, but the short around the 6905 area is still valid for today. Interestingly, the Bianca 10 day channel has tightened up a bit and the top is now only 6892. I think I will split my shorts and go off both those levels - 6892 and 6905 and see what happens.
I think the market is still heading a little bit higher though but shorting at resistance levels make sense, just in case it decides to start declining earlier. The 20 day channel top is at 6949 and I do have a longer term resistance level also at 6937 - so there are some key levels to watch over the rest of this week.
Support wise today I am looking at the daily pivot area at 6865 and below that 6838. If those break then 6811 and 6765 are the lower supports.
So, those are the main levels to watch but it actually gets a little tricky to call when its like this (not that its ever that easy of course!) as we have a decent 30 min channel with resistance at 6873ish, and support at 6855, so taking the bigger picture levels out I'd favour a dip down from this 6870 area (which is possible as the rise off the supports was pretty slow yesterday and buying interest at all time highs is going to start to wane). As such I am favouring those 2 shorts as the better trades.
Daily Raff Channels
Bianca Trends
Gold
Rising 30 minute channel on the Gold chart with support at 1290 and resistance at 1300 currently in play. Should that resistance break, 1304, 1309 and 1311 are the next levels to watch. Weakness below 1289 is likely to reach 1285.
S&P
Hovering around the round number 1900, even such a psychological level didn't really bring the bears out, so I still think the S&P 500 could go a bit higher.
Everyone seems to be keeping their powder dry at the moment, hence the lacklustre slow rises. If 1903 breaks then 1911 and 1919 are the next levels to watch. Support is 1896, 1890 and 1888, a break of this lower level probably meaning the top is in at 1902 for the moment.
DAX
Both daily trends are heading up on the DAX. All looks bullish, as well. Resistance is 9785 being yesterdays high, a break of that is likely to reach 9808 and 9833. Despite still being bullish its a bit lacklustre like the others. The top of the 20 day channel is at 9860 so if it were to get that high then that could be a stumbling block for the bulls.
Support wise, the daily pivot is 9756 so not to far below where we are looking at opening, a small long there to target 9800 might be worth a go.
