Technical analysis for FTSE 100 for 7h April 2025
*HODL - Hold On For Dear Life
Asian markets plunged overnight after Donald Trump warned foreign governments they would have to pay “a lot of money” to lift sweeping tariffs.
The US president compared the tariffs to “medicine”, his remarks triggering further carnage across global financial markets.
Another day and another sell off as the repercussions of the tariff announcements continue to play out. That said, having set an overnight low at 7660 the FTSE100 buying has kicked in and we are now at the 7900 area already. Volatility is the nature of the beast for the moment! I am thinking that we may well see this bounce continue to play out today and it might even manage to get to the 8144 daily pivot level if it gets a decent tailwind and before turning down again.
I am thinking that early on today we may well see the S1 level hold on any dip back, and that is at the 7811. Ending positive looks unlikely so I won't go as far as to say that a bull Monday is on the cards but certainly a retrace of some of the overnight decline looks likely.The gap from Friday is also at 7988 and the bulls will certainly be keen to try and recapture 8000.
We may well start to see central banks and governments initiate their own "stimulus" measures this week as well to support their domestic economies. In the UK, support for the motor industry is already starting to trickle out such as elite British carmakers being exempt from net zero rules.
On tthe FTSE100 10m chart to start with we have the green coral at 7815 now linking in with that S1 level. A bounce here would therefore make sense but if the bears go for it then hop on the short from a drop down to the overnight low again and a test of S2 at 7635.
If the bulls are able to get a rise towards the 8000 level then it bodes well for some more upside this week, though they certainly have a big task on their hands. 8000 is also the red 30m coral for today. Above that then 8144 does look possible, but the markets are still operating under "extreme fear" and the volatility index has risen sharply as you would expect.
I doubt that Trump will row back on his tariff announcements so global economies will have to adjust now. Time will tell how it all plays out. The FTSE100 will need a close above the 8200 level really to signify a change in sentiment.
Remember that while it is so volatile you can do lower stakes and continue to keep your guard up at the moment.
Good luck today.
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