The FTSE made a new high above 6743.5 and closed down. This means the third wave extended in five waves. Basically the current rally is a third wave, the rally will be complete with a final down/up move. As always on a Monday the economic news is light, we saw a better than expected German Ifo survey, the business climate index is improving in Germany. But the FTSE closed down because oil was down and considering we have a large weighing of oil stocks in the index, these stocks dragged the FTSE lower. The dollar is also up, this is a drag on commodity prices. The FTSE will struggle to go up if oil and mining stocks are down. Meanwhile the Fed is expected to keep rates unchanged tomorrow, probably as a safe measure while assessing the impact of Brexit on the US economy. My view is that rates will rise at the next meeting or this autumn if the US economy continues to improve. This supports my forecast for a major top around that time, rising rates will be one of the catalysts that will bring stock markets down.
Meanwhile we can capitalise on the small moves up and down with intraday trading. For example we buy near 6700 and sell near 6780. To receive daily analysis and trading signals on the FTSE 100 subscribe to the FTSE intraday