Technical analysis for FTSE 100 for 4th April 2025
Stock markets around the world tumbled on Thursday, the dollar sank and oil prices plunged after Donald Trump’s new global tariffs raised fears of a US recession.
Tariff fall out continues despite the positive talk from President Trump. For the FTSE100, it has been quite resilient and looks like the 8450ish area may well set up a decent double bottom. More upside to follow next week? Today it will be all eyes on the NFP at 13:30 and we may well see a rise and dip play out across the board ahead of that.
For the FTSE100 we have held the 8425 level which is the low from the tariff announcements on Wednesday evening, so a double bottom bounce off that would fit the charts well today and a rise towards the 8475 daily pivot and another test of the Hull MA.
If the bulls were able to break above the 8475 level then the 8525 level is the next key area where we have the 30m 200ema, R1 and the key fib. If we were to see this then another short here is worth a go, though being NFP Friday it's a good day to stay slightly risk off.
Above that then the R2 level is 8582 but a rise to there will certainly need a very strong USA tailwind. The S&P500 bottomed out overnight at 5350 - quite the drop from 6100 in February! It was then when we were getting all the all time high headlines left right and centre - always a good sign that it's about to drop. Vice versa for pessimistic headlines - when it's really negative then that's the time to start buying!
Support wise for the FTSE100 then the 8420 are looks key as mentioned and I would like to see this hold really, and we start to get some upside next week back towards the 8700 area. However, if that were to break today then we will likely see a test of the S2 level 8367, and we also have the daily 200ema here at 8365 - should it get this low then this could well act as a decent spring board for the push higher in Q2.
The big question is if that's the worst of the pain over for the moment? Certainly a shock and awe approach so far, but of course Trump's main aim is to boost the domestic economy - we may well see the global economy become more insular over the next few years.
The S&P500 2h chart is bearish for today and the bulls need to break the 5450/5460 area today as we have the Hull MA here as resistance. Again, a rise and dip may well play out on that ahead of NFP, and then some profit taking ahead of the weekend.
The sizeable drop on the Dax40 yesterday may well retrace a bit today and we may well see a possible rise as far as 21911 to test the key fib. Its started to climb from the overnight low already so a rise and dip on this also make sense, though the bulls will need to break the pivot at 21775 initially.
So generally, cautiously optimistic for the next few sessions but a rise and dip today as its NFP Friday would play out well.
Good luck today and have a great weekend.
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