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FTSE To Squeeze Early Bears Before Dropping

Published 30/04/2014, 08:35
UK100
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US500
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DE40
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GC
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TWTR
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Bull Tuesday came good once again. But not really dipping as far as I would have liked for the long entry. The short from 6749 worked out well for a few points in the morning then prices bounce back and walled around 6750 for most of the afternoon. The trends are still up, looking at the daily charts, with the likelihood of the FTSE 100 reaching 6782 more likely.

I think we have a bit further to go higher before we dip. A few blogs and sentiment things are turning bearish so I think the market will want to squeeze these early bears before it drops. Good news on the UK economy front as we saw the economy expand 0.8% in Q1 of 2014. Not so good news for Twitter Inc (NYSE:TWTR) last night as their loss widens, shares falling 10% after hours.

FTSE Outlook

Interesting day yesterday that didn't really feel like it did much really, though the short worked out well off the Bianca 20 day at 6748 area. As such I think we might test that channel again today and a short from 6779 will bear fruit. The pivot for today is 6746 which is pretty much were we are as I write this, and if the uptrend is to continue could/should(!) act as support, at least initially.

We also have a 30 minute channel in play with support at 6738 so after an initial bounce before the open from the pivot i think a decline to that area is possible, before a climb to that 6780 area, which could present a decent shorting spot. The key will be breaking yesterdays high at 6762 though.

If 6780 area breaks then the next resistance is 6810 and 6830 (top of the Raffs), with a move below 6582 invalidating the uptrend. One thing to note is that we are currently at the top of the 50 day Bianca channel and appear to be trying to break out of that longer term trend - I don't tend to use the 50 day that much, as the levels are often exceeded for a while before snapping back; which would fit in with my hunch of a climb to slightly higher than were we are now, before a drop.

FTSE 30 min Chart

Daily Raff Channels

FTSE Daily Raff Channels

Bianca Trends

FTSE Bianca Trends

Gold

Gold made hard work of bouncing from 1290 yesterday, though it did eventually, reaching 1300 before dropping back. It now looks like its going to dip to 1288 again before another climb to 1305. On the longer term daily chart there is channel support at 1272 and resistance at 1340. Today I'd go long at 1288ish but with a stop at 1285, to target 1305.
Gold Daily Chart

S&P

Despite the dip on Monday to the bottom of the Raff 10 day the S&P 500 has held up well and the rising trend is still intact. Support today is 1871.5 and 1866 below that. resistance wise 1881 and 1885 are the levels to watch.

Long at 1872 to target 1885 is the plan here today.
S&P Daily Chart

DAX

Raffs are also still up on the DAX and with the pivot at 9553 for today a dip rise dip scenario could play out here as well, similar to the FTSE and S&P. Below the pivot 9533 and 9500 offer support, whilst resistance is 9610 and 9640.

As such small longs at 9553 and 9533 might be worth a go to to target 9610 and 9640. Shorts at 9640 are then worth a go, but with a tight stop as if it keeps rising then it could well reach 9740.

DAX Daily Chart

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