FTSE 100 live outlook prediction analysis for 9th July 2020
A risk-off mood on global markets lifted the price of gold to more than $1,800 (£1,426) an ounce for the first time since September 2011. The precious metal – seen as a safe haven – has been on a steady upwards trajectory over recent months against a backdrop of economic turmoil and concerns that inflation may rise in the near future. A softer US dollar also assisted the metal on Wednesday.
Here’s a short summary of yesterday:
- Europe’s stock markets slipped for a second straight session amid concerns about fresh spikes in coronavirus infections.
- It helped haven investment gold above $1,800 an ounce for the first time since 2011.
- The eurozone’s key indices were down by a percent or more at the close, with London doing a little better.
- On Wall Street the Dow Jones was unchanged in the late New York morning.
- Rishi Sunak, the Chancellor of the Exchequer, announced £30bn worth of schemes that should help trigger economic activity.
- The stamp duty threshold for England and Northern Ireland will be raised from £125,000 to £500,000, until the end of March 2021.
- The hospitality and tourist sectors have been hit hard by the health crisis, so Mr Sunak will cut VAT for the sector to 5pc from 20pc – it will be in place for six months.
- People who dine out between Mondays and Wednesdays will have up to £10 knocked-off the price of their meal in August.
Equity markets in Europe closed in the red, with London performing slightly better than its counterparts in the bloc. The FTSE 100 closed 0.6pc lower at 6,156.2 while the domestically focused FTSE 250 fell 0.95pc to 17,185.2 as the Chancellor’s summer statement failed to excite traders. The government assistance provided to the hospitality and housing sectors seemed to have little affect on shares, with leisure companies and housebuilders ending the day flat.
Virus Resurgence
Hong Kong reported a second day of rising local infections, disrupting a long virus-free stretch that had allowed life in the Asian financial hub to largely return to normal. The city found 19 new infections in the community with six of unknown origin, government officials said in a press briefing on Wednesday — the most since April 1. This follows the disclosure of nine new local cases on Tuesday, five of unknown origin. The number of new local infections that can’t be traced suggest that hidden chains of transmission have been circulating in the city for some time as social distancing measures were eased and people returned to work and social activity. Hong Kong had successfully quelled two waves of infection in February and April and its total outbreak numbers only 1,323. The virus is roaring back across the region in a sobering reminder that the pandemic is far from over, even in places with the best containment track records. Australia’s second-largest city, Melbourne, re-entered virus lockdown this week as cases surged in Victoria state, while Japan continues to find about a hundred new infections daily in its capital of Tokyo. In Beijing, schools remain closed to halt a new outbreak.
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
Asian stocks pushed higher Thursday as investors continued to place faith in policy support and shrugged off simmering tensions between Washington and Beijing. The dollar steadied.
Overnight the FTSE 100 has held up well and the S&P managed to retrace the recent fall to retest the resistance line again, at 3180 this time. That tallied with the 2 hour resistance at 3179 and we have had a small drop off from there so far. The FTSE 100 has also tagged its 2 hour resistance overnight at 6208 and dropped off. The 2 hour coral is now also red with 6219 resistance so we may well see an initial dip down today.
The first support is at 6170 where we have the 30min coral, though a spike below this (as seems to be the case at the moment) would likely manage the S1 and fib level at 6144 and also a likely retest of the 6125 recent low. An initial dip also tallies with a drop off the cam break out level at 6191 to start with, as well as those 2 hour resistance levels mentioned.
The bulls will be keen to defend that first support and pull out a rise towards the 6220 area again but again, it still feels like shorting the rallies is the best play. The budget yesterday didn’t have much to get the bulls excited, as we saw by the lacklustre FTSE performance. The S&P still cant break 3190 either. I can still see a dip down to test the daily coral lines on both – 3060 S&P and 6092 FTSE – at some point soon.
If the bears were to break below the 6144 level then we are on that path towards the 6050 level still, an overshoot of the daily coral and then a possible bounce there. Yesterday the bears tried to break the 6135 level, managing 6125 before being fought off. They really need to be a bit stronger at the moment.
If the bulls were to break above the 6235 level today then 6330 is on the cards, but only if they break resistance. Seems a bit of a big ask for today though. We have definitely had a lot of sideways chop recently, as you can see on the daily chart below, with candles perfectly alternating between positive and negative since the 24th June. If that pattern continues we should see a positive close for the FTSE 100 today….
So, looking at 6144, 6125, 6093, 6050 as support for today, 6219, 6230 and 6264 as resistance levels. Good luck today.
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6050…. done!