FTSE 30 minute chart 7th December 2016 pre-market
Morning all. After several weeks of trading range behaviour on the market we have signs that things may be changing. The FTSE is currently in an uptrend on this 30 minute chart. We have broken above the sloping black downtrend line on our chart and we are currently pushing higher.
As always this morning I am going to identify some context areas for the market so that when price reaches these areas later in the day I can look out for good trading signals. context and content are the two criteria that I look for when taking trades.
You will notice that I have plotted the 20 EMA on my chart. I do use this indicator when the market is trending because I find it useful for judging with-trend entries. It operates like a “value” line and so entering when the price pulls back to the line offers good value and price often pushes away again in the direction of the trend.
You will see that I have also plotted a bull trend channel with two up-sloping blue lines. In order to plot these lines I first of all plotted the lower line across two swing lows. This is the uptrend line. I then drew a parallel line across the recent swing high.
I will consider the bulls to be in control in a bull trend until the market reaches a key level and then puts in a lower high. 6850 is a key round number level, so I will be watching for what happens if the market stalls there. Also the top of the bull channel may cause a price reaction.
When the market is trending I always favour with-trend trades because markets can trend for a long time. Some days the market will trend all day and rather than sit at my computer waiting for reversals I would rather be trading with the trend.
Below the current price we have yesterdays close (golden line) at 6776. That level also currently co-incides with the old bear trend channel line and the new bull trendline, so there is plenty of confluence there if the market dips on the open.
Round numbers as always may play a part today. possibly 6900, 6850, 6800, 6750 and 6700 are all within todays possible range.
Have a great trading day.
Update – FTSE Trading 6th December 2016 – 4.45pm