FTSE: 7390 Support, Start Of Month Bull Rise
FTSEDayTrader Limited | Aug 01, 2017 09:04
What a lovely drop off 7425 that was, pretty much the high of the day, all the way down to the target at 7385. The low of the day was in fact 7370 and the bulls have subsequently fought back to get the FTSE 100 back above 7400.
No bull Monday yesterday, so same as last week, which should tie in with a bit of bull Tuesday instead, coinciding with the start of the new month and the influx of new money. More political turmoil in the US after Trump's spokesman, Anthony Scaramucci, was dismissed after less than 10 days. Meanwhile, in the UK Moody's has expressed caution on the UK unsecured debt pile which now stands at over £200 billion!
Household debt is high and still growing, leaving consumers vulnerable to an economic downturn,
Explained Moody’s Greg Davies.
Higher inflation, weaker wage growth and levels of indebtedness leaves those in lower-income brackets the most exposed.
Sub Prime II anyone?!
FTSE 100 outlook and prediction
I have a fairly simple plan for today and that is to go long and look for a rise towards the 7450 area, possibly 7475. I am thinking that we may get a small initial dip, though its 50/50 if we will or not. A dip down to 7390 would make a great entry as we have some decent supports here and with the rise from 7370, the 2 hour chart has gone bullish again, with support here too.
The 30min chart is showing some negative RSI divergence to start with, hence why I am thinking a dip down to the support level before a climb for the start of the month. The rest of August might be a bit more bearish as it's typically a weak month.
If the bears were to break lower though, and get below 7390 then that will change the picture and we are still on that path towards 7340 and ultimately 7200. All things considered and despite everything going on in the world the markets remain robust. Stocks really are the only smart place to have money at the moment as most other asset classes are looking a bit ropey - the property ship has sailed now, for example.
So, buy the dip for today.
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