Dominic Picarda’s Daily Pick 21st October 2013

By Dominic Picarda.

The key to successful trading is letting your profits run and cutting your losses. I am always baffled by those who seem to be forever looking for things to end in tears before the party is even fully in swing. I read one piece this morning suggesting that the overly bullish state of retail sentiment in the US represents one reason why we should be cautious right now. Another bearish omen is supposedly the markets’ overboughtness right now. But I think the indices are mainly overbought only on a very near-term horizon, and that a tiny dip would resolve that. I am staying bullish on the outlook for DAX, FTSE, S&P, EURUSD and GBPUSD.

FTSE 100

Friday: “A move through 6660 will trigger a change-of-trend buy-signal on the swing-chart.” While the FTE has gone above that level in overnight trader, it’s only the session trade that counts for the swing-charts. I remain bullish and am targeting an initial move to 6718.

Support: 6619.7– Resistance: 6732.3

Support: 6540.6 – Resistance: 6718.2

Support: 6396.1 – Resistance: 6699.1

Support: 6362.3 – Resistance: 6662.3

DAY: Stay long or buy a strong hourly close through the 21-hourly EMA.

POSITION: Stay long. 

Dominic Picarda CFA, CMT writes the Trader column at http://www.investorschronicle.co.uk/comment/the-trader