Technical analysis for FTSE 100 for 14th August 2024
UK stocks ended higher on Tuesday, helped by insurers' shares as investors looked to crucial inflation numbers at home and in the United States for direction on global interest rates, while Crest Nicholson lagged the mid-caps.
The blue-chip FTSE 100 index and the mid-cap FTSE 250 index added about 0.3% each and extended gains to a third consecutive session.
Investors are now looking ahead to the crucial consumer prices index (CPI) reading from the UK and the U.S. on Wednesday to strengthen bets on monetary policy easing by the BoE and the Federal Reserve.
Stocks in Asia gained on bets that the upcoming US consumer price report will allow the Federal Reserve to start easing in September. The New Zealand dollar slumped following a surprise rate cut by the country’s central bank.
The MSCI Asia Pacific Index climbed for a fourth session, with shares in New Zealand and Taiwan jumping more than 1%. The gains came after the US producer price index rose less than forecast, helping to fuel a 1.7% rally in the S&P 500. Japanese stocks fluctuated alongside the yen.
- APAC stocks only partially sustained the momentum from Wall St where risk sentiment was underpinned by softer-than-expected PPI data.
- RBNZ cut the OCR by 25bps to 5.25% (vs. mixed views between a cut and a hold); projections point to a further reduction this year.
- Japanese PM Kishida confirmed he won't run for re-election as LDP leader.
- European equity futures indicate a mildly positive open with the Euro Stoxx 50 future up 0.3% after the cash market finished with gains of 0.5% on Tuesday.
- DXY is steady above 102.50, NZD is the clear laggard post-RBNZ, JPY unfazed by Kishida stepping down.
- Looking ahead, highlights include UK & US CPI, Supply from Germany & France, Earnings from Aviva & Cisco.
FTSE 100 technical analysis for today, 14th August 2024
Nice climb off the supports yesterday for the FTSE100 and and the S&P500 to yield a decent haul. We may well see that continue into today, though data shows that the inflation rate picked up for the first time this year but remained below the level economists and the BOE had expected. This does though bolster the case for further rate cuts after August's reduction.
Initially today we have key resistance at the 8300 area, with 8287 on the daily, 8291 as the key fib and then round number. We have just spiked to this region on that inflation news, so a small dip back from here to test the 8250 support area would fit well and hopefully isnt too much to ask!
Above the 8300 level then the bulls almost have a decent run at the longer term 8420 area and a test of the top of the 10d Raff channel. That feels a big ask for today but the longer it stays above the 8200 level the more likely it is during this week.
For today, if the bulls were to break above R2 at 8307 then R3 8353 is next up on the path to that 8420 area, and we could see a stutter here.
We have a large 26 point dividend today as well, which will help the bullishness today as well and we may well see some buying come in prior to the bell to chase that. Bear in mind if you're short at the close then the dividend will affect your position.
Support wise the 8250 looks decent to start with as we have the green 30m coral here, and also the Hull MA which is now bullish following yesterday's strength. The daily EMAs have also gone bullish once again and have support at 8205 from the 25ema. Any dip to this line may well get bought up.
We also have the daily pivot at the 8233 level and should we see that then I would like to see that hold again for a rise during today.
Below 8200 the bears will be aiming for S2 at 8159 though I think that we may see today be a bit stronger again, helped by the divi as well. Still buy the dips for the moment really....
Good luck today.
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