A rise towards 7225 todayToday's big event is the Fed later and we may well continue to tread water this morning ahead of that at 1900 this evening. Interestingly, with the S&P dropping off the 4265 resistance level yesterday and never regaining that level the 2h chart has gone bearish with 4256 resistance - if we get a rise to that during today ahead of the Fed then we may well see some bears appear here. Also a bit more profit taking ahead of the Fed as well.
That would tally with a rise on the FTSE 100 to the 7223 resistance level on the daily chart, along with the key fib also at this level. I quite like a short at this level. Rise and dip may well play out today. Below that level then we have R1 at 7195 and R2 at 7211. R3 is at 7232 so not too far above that daily level and we also have the top of the 10 day Raff channel at 7232 as well. As such, this upper resistance area certainly looks like it should get a reaction. Above here though and the 7246 level is the top of the 20 day Raff and the next daily level is 7260 above that. I dont think we will get that high today but if we did then a short here is worth a go.
For the bears they will need to break below the daily pivot support at 7174 to start with. The futures have held up well overnight and as such the bulls remain in control (just!) for the moment. Below the 7174 level then 7146 is the next decent support where we have the 200ema and just below the 2h coral as well, with 7129 below this for the key fib level. 7137 is also the R2 level, and just above that key fib so I would like to see this defended if it were to be tested.
Looking at the daily chart both the Raff channels are firmly heading up (and also the same on the Dax and S&P) so we may well see a bit more upside for the moment but we are getting closer to the seasonal bearish period at the back end of June and a dip down into July may well play out soon. So cautiously bullish for the moment! I imagine we will start to see some risk off kicking in soon - maybe next week. A lot of todays action will depend on the Fed today and positioning for that. A rise and dip (buy the rumour sell the news) would certainly fit fairly well.
