On trending days, like yesterday, the market never pulls back to support to get a good entry. It busts through resistance levels to take out the trades (or vice versa if it’s trending down). The short at 6670 got stopped out and the other risky one at 85 did too, so not really ideal and no dip to get long on.
On the flip side, the 20 day Bianca channel top around 6698 held despite the bulls trying to break 6700. For today the level has moved to 6709, so watch that area. Also of note is that all 3 Bianca channels are in the 6700 area (6693, 6709, 6729) so we might see a bit of resistance here.
Slightly weaker Chinese PMI data overnight, priming 48.3 in April, just matching estimates, and showing continued weakness (being below 50).
MacDonald’s results missed slightly yesterday, but today tech heavyweights - Facebook and Apple, both report after the bell. So, it will be volatile later as they have a big effect.
FTSE Outlook
It’s earnings season at the moment and yesterday was the first day back after the 2 bank holidays. So, it was always going to be a little tricky.
For today, we have the FTSE 100 pivot at 6671 and I think after making the gains yesterday, the bulls will be keen to maintain that momentum. However, I do have quite major resistance at 6710, so I think they will struggle a bit there.
As mentioned above, there are 3 Bianca channels nearly in play at this level, as well as the 20 day Raff at 6730ish. As such, I do think it might pull back shortly.
For today, on both the 10 and 30 minute charts we have decent channel in play. Both are showing support around the 6670 area, so with the pivot there I think that area is worth a long. If we don't get the dip again then I am shorting at 6709 off the 20 day channel.
Despite dipping from 6698 yesterday, it’s not really been that bearish, which is why i think we might test the channel again. Two tests of a resistance (or support) I will trade, generally if it tests a third time, then it is likely to break, so if we test that channel again tomorrow, it will invalidate the bearish element and we might rise to 6780.
Gold
Still pretty bearish! The daily chart for Gold shows support at 1272 and if that holds then potentially a rise back to 1315 is on the cards, provided 1289 is broken. I think a long at 1274 would be the next trade on gold for me as the support at 1277 is likely to break.
It’s quite a strong downward channel on the 30 minute. Bulls really need to get the price above 1291.
S&P
With Apple and Facebook the main results out on the US later, the S&P 500 is likely to get a little volatile. Support today is 1879, which is the daily pivot, a break of which would then target 1874.
If it goes lower, then the worm has probably turned and it will stay bearish for a few sessions. If those support hold then resistance at 1882, 1885 and 1891 are in play, along with the top of the 20 day Raff at 1894.
If I relate the FTSE to this then a rise to 1885 for today, coinciding with the FTSE hitting 6710 before dropping back would seem to fit the plan.
DAX
The DAX put in a big rise yesterday and is likely to hit that PRT lien at 9654 today, if it continues. It has stalled around 9620, which was yesterday’s resistance level. So, any drop bach is likely to find support at 9547 (daily pivot) then 9490. As with the others, if it hits resistance at 9650, FTSE at 6710 and S&P at 1885 they could all be primed for a dip back.
