Technical analysis for FTSE 100 for 3rd February 2025
Well another messy Monday morning start with the big gap down to contend with as markets react to the Trump trade war that seems to have been declared! Initially we are on some decent support to start the week though at the 8550 area as we have S3 here, and also the key daily support at 8560. The next main daily support below here is 8480 and should we get that low then I would like to see this hold.
Despite the technicals bing a bit unclear I am expecting a bit of a climb up initially (being a bit contrarian here) and an attempt at the gap close. We will also have the new month money flowing in initially to help with that. That may well be a bit optimistic and hopefully not misplaced, but a rise towards the 8600 level initially would fit well, to test the 30m 200ema.
Ultimately today, though it may well be a big ask, is a potential test of the 8650 level where we have the Hull MA on the 2h for resistance, along with the daily pivot and the 30m red coral line. If we were to see this, and bear in mind that would also close the gap left from Friday, then a bearish reaction here would make sense.
The FTSE100 seems to have been a bit more resilient so far in the face of the bearishness emanating from the S&P500 which has gapped down over 100 points, and also the Asian markets. Maybe as the UK isn't quite in the tariffs crosshairs at the moment.
From looking like we were about to see 8700 on Friday to now trying to defend the 8550 level, volatility is certainly back. Also helping the bullish cause is the expectation that the BoE will be cutting rates soon (funnily enough probably in February as I mentioned about 4 months ago!)
In terms of key levels, the FTSE100 and S&P500 are both around their S3 level, while the Dax40 is below but has defended the round number at 21100, so if we do see a defence from the bulls initially then a rise this morning would fit the charts well. All about the 8550 and 5915 levels really.
Good luck today and keep your guard up today!
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