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London’s FTSE 100 erased early gains to end lower on Friday as losses in miners eclipsed rise in energy stocks, while Wickes Group soared on an upbeat profit outlook. After rising as much as 0.9pc, the FTSE 100 ended 0.1pc lower after base metal miners declined, tracking weakness in copper prices. Limiting losses were oil majors BP and Royal Dutch Shell up 1.3pc and 0.8pc respectively as crude prices jumped after the producer group OPEC+ said it could review its policy to hike output at short notice if oil demand collapsed.
Stocks and futures showed a degree of stabilization in Asia Monday with investors weighing the latest on the omicron variant and the regulatory outlook for Chinese technology companies. Treasuries pared some of Friday’s rally.
U.S. futures pushed higher while benchmarks saw modest declines in Japan and Australia. In Hong Kong, an index of Chinese tech stocks retreated for a third day. Mainland China shares rose and the nation’s government bond rallied amid bets the central bank will soon ease monetary policy to aid growth.
China’s securities watchdog on Sunday tried to play down fears over Chinese companies’ withdrawal from American exchanges. Didi Global Inc.’s plans to switch its listing to Hong Kong from New York sent the nation’s shares in the U.S. tumbling and sparked fears others might follow.
Treasury yields rose, trimming Friday’s plunge that sent the 10-year yield closer to 1.30%. Attention turns to U.S. consumer prices which are expected to show the largest annual advance in decades, keeping pressure on the Federal Reserve to deliver swifter policy tightening.
FTSE 100 live outlook prediction analysis for 6th December 2021
The bulls have fought back from the Friday lows as we tested the green 2h coral for the first time at 7097. Having added nearly 100 points we are now at key fib resistance at the 7180 area to start with today so a familiar pattern of dip and rise may well play out today. If so then a drop down to the key 30m support levels at 7138 look good as we have the coral, daily pivot and 200ema all here. I am still looking for a rise towards the 7202 level where we will have the first test of the 25ema on the daily and key resistance – and we could see the bears reappear here in earnest.
That 7200 level could well tie in with the S&P hitting the 4582 resistance level as well so we may well see both of these drop in tandem from these levels.
Above the 7200 level then 7244 would be the next bullish target as we have R2 here long with the daily coral. Its also just inbetween the top of the 2 Raff channels as we have 7233 for the 10d and 7276 for the 20 day – so should we start seeing these levels then expect some bearish reaction around here. The Omicron mutation seems to all intents and purposes to be mild, though more transmissible, and has helped the market to recover some of that lost ground for the bulls. Its possible that we still get a small dip down prior to a leg back up, and that 7200 area could be the catalyst.
Below the 7140 level then the bears will ultimately be aiming for the 7070 level again, with 7030 below this the next key level. As you can see from the key levels table though there are quite a few supports in play currently, which should help the bulls to hang onto this rise.
The S&P bulls need to break 4582 as mentioned, and if the bears mount an assault here will be looking to drive it down to 4545 and 4500 again below that. However, if the bulls can break above it then we should see a rise to 4611 where we have the 25ema resistance on that.
Likewise on the Dax, the 25ema daily resistance is coming into play at 15641 currently – and I am looking at a rise on all three to test this key moving average. It will then be up to the bears to drive a reaction off this line on the FTSE100, Dax40 and S&P500.
Of course a Santa Rally is usually only confirmed after the event as to when it started, how long it lasted and when it finished, however if we keep rising form the recent 6971 level towards the end of the year we are currently in it, or if we get another leg down off the 7200 level and then back up it will deem to have started then! Put that aside though and for the moment I am looking at a rise towards the 7200/7220 level and then a drop off that – targeting 7180 initially. but maybe lower, especially if the news flow turns negative again with regard to restrictions and so on.
Good luck today and watch 7145 and 7065 as the main supports, 7180, 7200 and 7220 as the main resistance levels (7220 being an overshoot of the 7200 25 ema daily resistance)
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