Technical analysis for FTSE 100 for 22nd November 2023
The FTSE 100 declined 0.19pc Tuesday to 7,481.99, while the FTSE 250 dropped by 1.35pc to 18,347.63. The FTSE 100 receded on Tuesday with heavyweight energy stocks falling on lower crude prices, while the pound gained steam after comments from Bank of England officials, further pressuring the exporter-heavy index. Heavyweight energy stocks lost 1.0% tracking lower oil prices, as investors turned cautious ahead of an OPEC+ meeting this Sunday when the producer group may discuss deepening supply cuts.
Meanwhile, Britain borrowed less than predicted by its budget forecasters in the first seven months of the financial year, data showed, a day before finance minister Jeremy Hunt is expected to announce some pre-election tax cuts.
In Asia, stocks traded within narrow ranges while the dollar hovered near its weakest level in almost three months ahead of national holidays. A gauge for Asian equity benchmarks was mostly unchanged as artificial intelligence stocks slipped following a tepid reaction from investors on Nvidia Corp.’s earnings. Futures for European and US stocks were little changed as trading became more muted in the leadup to a holiday in Japan and US Thanksgiving on Thursday.
Asian stocks backed away from 2-1/2-month high on Wednesday and the dollar found support as investors' tempered some of their earlier enthusiasm about the prospect of an end to U.S. rate hikes.
FTSE 100 technical analysis for today, 22nd November 2023
We got the 7450 test and the bulls managed to defend it so far, which if it holds sets up more upside. That was the 25ema so a fairly key level on the daily chart for the FTSE100, though the US markets have yet to test their 25ema supports. If they drop further then that may well drag the FTSE100 down with it over the rest of the week. That said, the Raff channels for the daily trends are all heading up across the board so we still have bullish sentiment.
Initially today I would like to see a rise to test the 7520 area once again, whereupon we may well see a drop off once again. Of course the line in the sand remains key support at the 7450 level, but we have support at 7475 to start with. The 30m 200ema, daily pivot and now green 30m coral are all here, so as long as the bulls are quick out the blocks we should see a bounce from here.
The bulls will certainly be keen to build on the bounce from 7450 and pull away from it, whilst also trying to break above 7500 (and hold above it). Above the 7520 resistance is R2 at 7530, but then more crucially move that the 7560 R3 level. 7525 is also the daily 200ema, and the line that we dropped off on the 15th November, so lends more weight to a potential double top in this area.
If the bears were to have a go today then obviously they will be looking to break 7450, as that would then allow a slide down to the 7420 area where we have S2, and also the bottom of the 10d Raff. If this were to be seen to0day then I would like to see a bounce here so it will be worth a long. 7409 is also the daily support just below this.
We have the US closed tomorrow for Thanksgiving, so a rise and dip today may well play out as some positions get banked ahead of that. Could also then set up well for a climb on Friday as the post-Thanksgiving buying starts.
The big event in the UK today will be the Chancellor's Autumn Statement at midday. Tax cuts and various other feel good elements likely! There is also US durable goods Orders for October due out at 1330, with a forecasted drop to -3.1% from 4.7% previously. May see some chop then.
The dividend is 9 points today.
Keep an eye on 4554 for the resistance on the S&P500 as well.
Good luck today.
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