FTSE 100 Support 7014 7007 7003 6985 6976 6950 6903 6892
FTSE 100 Resistance 7033 7064 7083 7121 7156
The rhetoric about the drone that China captured on Friday continues, with the Pentagon saying that it will be retuned. Either way, the breaking of that news on Friday certainly helped my gold trade which, had just tagged the buy order at 1130, to climb straight to the 1140 target. It saw equity markets dip a little bit and then bounce, with the SP just tagging the stop on the long and the FTSE just missing so not as much joy with those.
However, the support on the 2 hour FTSE chart held and set up a decent bounce, which has carried forward to this morning. We are going to have pretty light volume this week and most will be expecting the Santa Rally phenomenon to start this week. So, we could wee see the FTSE 100 rise to the top of the 20 day bianca at 7083 and then a retest of 7130 over the course of today/tomorrow.
FTSE 100 Outlook and Prediction
For today I am looking at a pretty simple plan and looking to go long at around the 7015 area for a run to the 20 day bianca channel top at 7083. The 2 hour chart support held well on Friday (albeit from slightly higher than my long order) and has stayed bullish since. As such, buying the dips is probably a good move for the short term. This rally started at the 6680 level on 5th December (still can't believe we nailed that long entry there) and has run pretty well since, so probably has a bit further to go. Above 7083 we are looking at 7130 for the recent high, then 7156 level for the top of the 20 day raff channel.
Support wise, if 7015 breaks then 6985, 6972 and 6950 are the immediate supports. We also have 6960 for the bottom of the 10 day bianca channel. For today I think that the 7000 level will hold.
In the week ahead, we have the release of Thursday’s final reading on U.S. third quarter gross domestic product for fresh indications on the strength of the economy and further hints on the future path of monetary policy. There is also a monetary policy announcement from the Bank of Japan on Tuesday, with most investors expecting the bank to hold its negative interest rates and 10-year government bond yield target steady. 