FTSE 100 live outlook prediction analysis for 12th March 2020
Equities and oil prices fell through the floor again on Thursday after Donald Trump announced that all travel from Europe to America – excluding from the UK – will be suspended for 30 days.
In one of the most dramatic addresses to the American people in recent history, the president said that starting at midnight on Friday (4am Saturday GMT), for 30 days no foreign nationals can visit the US from Europe.
Asian equity markets cratered while oil prices were also hammered, with both main contracts falling around six percent at one point before edging back slightly. Japan’s Nikkei has closed down 4.4pc, recovering slightly from a drop of 5.42pc earlier this morning. Hong Kong shares finished Thursday’s morning session almost 4pc down. The Hang Seng Index tumbled 3.81pc, or 962.55 points to 24,269.06 by the break. The benchmark Shanghai Composite Index fell 1.34pc, or 39.72 points, to 2,928.80, while the Shenzhen Composite Index, which tracks stocks on China’s second exchange, shed 1.76pc, or 32.66 points, to 1,826.73.
US stock index futures cratered on Thursday, dropping near to their maximum down limit. S&P 500 futures fell as much as 4.7% to 2,610 points, near the overnight down limit of 2,601 points. They pared some losses by midsession in Asia, but at 3.8% in the red still point to the possibility of another rough day on Wall Street.
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
Well what to say, we are starting the day down nearly 5%, but the bottom of the 20 day Raff channel has held overnight. If we go back down to that level then we may well see a bounce here, which would tally with the S&P support level at 2540. There is some current support forming at 2635 though but will that hold as Europe opens…. probably not.
In theory we should see a bit of a retrace of the overnight falls but we do have a panic selling situation on at the moment, and coupled with he US travel ban, that fear is unlikely to disappear just yet. But, if we do get a retrace then we could well see a kick up initially this morning, to back test the S1 level at 5675. The 25ema on the 30min chart is also at this level so it will be interesting to see what it does here, should it get there.
For the moment, the Raff channels may well hold with 5450 and 5385 the levels to watch. The S&P hasn’t tested the bottom of its Raff channels as yet – 2596 10 day, 2555 20 day – so keep an eye on those levels for today as well. The Dax tested and bounced off the 20 day channel at 9628. Talking of Dax – quite the fall from 13850 last month. Yikes!
If the support does hold, then we may even rise to test the 2 hour resistance at 5750, though that seems a big ask to start with. If it looks like the bulls start buying then its worth hopping on to possibly target this area. A 200 point climb is possible but does seem a tall order right at the moment.
So, looking at 5450 for support, 5675 and 5750 as resistance for today.
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