Buy The Dip - Can FTSE Hold The 6900 Level?

Friday's weakness has continued into today and the bears have got the price below 7000 with a possible run at the 6930 and 6900 support area looming. That may well tie in with the S&P 500 dropping down to test its S1 level at 4126 before a possible bounce from around these areas.

The bulls will have a big job on their hands today to get a bull Monday but they will certainly be trying to get the price back above the 7000 level. 

Initial support for the FTSE 100 is at the S1 level 6956 to start with and we may well see a hold of this for a push up towards the 7000 level to get things started. Below this then the 6906 level is the next one I like for support as we have a daily support line here, and also the S2 level for today. A break of 6950 will likely see a slide down to that.  

I am actually liking this pull back to set up a decent rally as we head towards the end of the year to be honest. Data and general economic conditions notwithstanding. If we were to get into recessionary territory next year as is expected in some quarters they may well want to get everything even higher first. The daily RSI has dropped to 32 and traditionally the back half of June is weak anyway. We also have a seasonal low on gold around here in June as well and that seems to be fitting the mould - so again we could see a bounce on that in the next few weeks as its sitting on the bottom of its 20 day Raff channel today. 

For the bulls the initial resistance is at 6992 for the 25ema on the 30m, with the round number of 7000 above that, the 30min coral is currently at 7023 but steadily dropping and could meet the price rising to 7000 later this morning - hence thinking that we will then see a dip here as that would be the first test since the colour change to red (so now resistance). Above the 7000 then 7061 is the daily pivot and probably a level that would cap any bullishness today. Above that though and the key fib and 200ema are at 7105. Can it get that bullish today though!?

As mentioned I would like to see the S&P hold its S1 level at 4126 today though as a break of that upsets the apple cart further and with S3 down at 4048 today we could see the bears try and take it that low. 

We are just below the Raff channels on the S&P, and a lot below them on the Dax and FTSE, so a bounce up to back test the FTSE ones (at 7005) would make sense for this morning. 

Good luck today.