Technical analysis for FTSE 100 for 2nd November 2023
The FTSE 100 closed up 0.28pc at 7,342.43, as investors increasingly expected the US Federal Reserve to keep interest rates on hold, as they in fact did. Meanwhile, the FTSE 250 midcap index ended 0.6pc higher at 17,185.89.
The Federal Reserve in the US has decided to hold its benchmark lending rate between 5.25pc and 5.50pc. Rate-setters at the Bank of England are widely expected to follow and hold borrowing costs steady when they meet on Thursday. This would provide some small reassurance to mortgage holders, with the base rate already at a 15-year high of 5.25pc.
Asian shares and bonds extended a global rally on Thursday as a non-committal Federal Reserve chief had markets double down on bets that U.S. interest rates have peaked and cuts are on the way.
The next big focal point for the market is non-farm payrolls data on Friday, which analysts expect to show the economy added 180,000 jobs in October, slowing from 336,000 increase the previous month. It will come after mixed data showed strong job openings and slower than expected growth in private payrolls.
FTSE 100 technical analysis for today, 2nd November 2023
A great start to November yesterday with all the trades panning out well. Going to be a bit more cautious today though as we head towards the BOE at midday and a likely hold of rates at 5.25%. I am thinking that we may we will see a buy the rumour sell the news day and we finally test that 7417 daily resistance level. We have some key resistance on the 30m chart just below that though with the key fib at 7408 and the R1 level at 7405.
As such if we see this area then a short here looks to be worth a go for a drop down towards the key support at 7350. I would like to see this hold today if it gets tested as we have the 30m coral, daily pivot, and 30m 200ema here, so some decent support indicators.
If the bears were to break the 7350 level then a slide down towards the 7300 level once again looks likely, though I am expecting the bulls to try and maintain the momentum from yesterday and defend any initial drop. 7309 is the key fib also for today.
I am still keeping an eye out for a test of the 25ema on the daily, sitting at 7450 for today. That would therefore be a likely target if the bulls manage to push above the 7420 level.
7435 is also R2 so a few levels in this area.
The S&P is nearly just testing the top of the 10d Raff channel while the NASDAQ is testing its one. As such we may well see some profit taking on them, which would probably filter though to the FTSE100 and help the bears.
Don't forget the BOE at midday, we may well see some chop around then.
Good luck today.
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