FTSE 100 live outlook prediction analysis for 29th September 2020
Monday in a nutshell:
- Pound climbs as much as 1.4pc
- FTSE 100 rises solidly
- HSBC shares soar as top investors boosts stake
- Markets and pound jump: The FTSE jumped hand-in-hand with sterling amid a relief rally across global markets. London’s blue-chis closed up about 1.5pc higher, while the pound rose as much as 1.4pc against the dollar.
- Caesars tables £2.9bn takeover bid for William Hill: Caesars Entertainment has tabled a £2.9bn takeover bid for high street stalwart William Hill.
- Petrol station kings take pole position in Asda race: Asda is set to be sold to a UK-based private equity firm and two brothers who own thousands of petrol stations after Walmart made TDR Capital the preferred bidder for a majority stake in the supermarket chain.
- Uber wins appeal against London ban despite ‘historical failings’: Uber has been cleared to continue operating in London after a near three-year battle with the city’s transport authority despite a magistrate criticising “historical failings” by the company.
- Five years of jobs progress destroyed as Covid hits youth employment: Unemployment surged among young workers over the summer even as schemes to preserve jobs succeeded in keeping older Britons employed.
Markets Rally
Asian stocks look set to extend a global rally amid broad gains for equities led by financial shares. The dollar weakened. Futures pointed to modest advances in Japan, Australia and Hong Kong. U.S. stocks snapped four weeks of declines. Banks led the S&P 500 Index to its biggest gain in two weeks as investors found buying opportunities after the gauge fell to its lowest since July last week. HSBC added almost 9% after its biggest shareholder raised its stake, while an index of lenders rose the most in a month. Shares in Europe rose the most in three months. Signs that U.S. politicians are moving toward new fiscal stimulus has boosted investor sentiment, while the Federal Reserve continues to provide liquidity, and China’s economic reports are looking stronger. Still, caution remains, with traders awaiting the first U.S. presidential debate on Tuesday.
Isolating Iran
The Trump administration is considering fresh sanctions to sever Iran’s economy from the outside world by targeting more than a dozen banks and labeling the entire financial sector off-limits, three people familiar with the matter said. The move would effectively leave Iran — which has seen its economy crushed by the loss of oil sales and most other trade thanks to existing American restrictions — isolated from the global financial system, slashing the few remaining legal linkages it has and making it more dependent on informal or illicit trade. The proposed sanctions would have two objectives, according to the people, who asked not to be identified: close one of the few remaining financial loopholes allowing Iran’s government to earn revenue, and stymie Democrat Joe Biden’s promise to re-enter a 2015 nuclear deal if he wins the presidency. The proposal is still under review and hasn’t been sent to the U.S. president.[Bloomberg]
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
A global equity rally cooled in Asia as investors assessed the latest efforts toward U.S. fiscal stimulus and the rising toll of the pandemic. The dollar held losses.
Japan steadied after earlier dipping as many shares traded without the right to dividends. South Korea outperformed and China rose, while Australia and Hong Kong fluctuated. S&P 500 futures edged higher after the U.S. gauge climbed the most in more than two weeks Monday. Treasuries were steady. The pound consolidated an advance on speculation that successful Brexit trade talks could help shield Britain from a messy rupture with the European Union.
We had a slow drift up yesterday as the FTSE managed to defend the 5900 level but only managed a high around 5950, just short of the 5980 resistance level on the daily chart. As such that remains as resistance for today again, and we also have the top of the 10 day Raff channel at 5990 for the moment. I have put the short order here, but if you wanted a wider stop then that may work out too.
The ASX200 (Australia) had a stready drop today and as such we may also see bit of a bear Tuesday, especially after a bull Monday yesterday, and also ahead of the first Presidential debate in the US later today.
Should the bulls break above the 5980 level then we will more than likely manage the R2 level just above the 6000 round number at 6009, with a possible retest of the daily coral at 6027 on the cards as well. R3 is up at 6062 but I am not thinking we get that high today. Especially as the S&P is nearing the 3380 resistance level, with the top of the 20 day Raff channel here. It’s just popping above the 10 day channel as I write this, which is at 3362. The 2hr chart on the S&P has support at 3299 and 3268 so we may well see a drop down at month end (profit taking) to that area, and I am still expecting an October rally towards 3400+ on this.
For the FTSE, if we break below the daily pivot at 5927 this morning then we have decent support again at 5900, with the S1 level and 200ema on the 30min here. Below this then the 2 hour support level at 5850 is back in play, as we have a green coral here and may well see that hold. I have plotted the blue arrows on the chart below as my preferred route today, with the pink arrows as a possible plan B.
Below 5850 and it starts getting properly bearish again, and a slide down to 5757 or lower looks likely.
So bit of caution needed today, and it will be interesting to see what happens in the US later and who appears to get the upper hand. I am watching that 3380 SP level closely today. For the FTSE the key levels ar 5980, 6010, 6027 for resistance, and 5927, 5900, 5850 for support. Good luck today.
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