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FTSE100 live outlook prediction analysis for 3rd April 2023
US equity futures were on the back foot and the dollar rose with Treasury yields as a surprise production cut from OPEC+ drove oil prices about 5% higher. The group’s decision to reduce output by more than one million barrels a day came as a jolt to global markets Monday. It reverberated across asset classes as investors rushed to adjust for the risk that inflationary pressure may be more persistent than previously thought.
The surprise cut in oil production will push up the price of oil but equally that may well help BP and Shell, and in turn help the FTSE100 put in a bit of a bullish shift and a rise to test the 7677 key fib and daily resistance level.
Initially we are on the daily pivot for support at the 7645 level, along with the S&P500 futures also in their key support zone at 4090-4095. As such, if the bulls are quick out the blocks on both of these then an initial rise would fit pretty well.
Below 7645 daily pivot then 7628 is S1 and would probably be seen if the bears were to start driving it down. This level is also the 25ema on the daily and whilst not a definite signal from that line currently, the fact that the bulls have brought it above that line, and looking like they want to push on we may well see that hold.
The 2h chart remains bullish for the moment, and 7644 is also the Hull MA, so again, it will be interesting to see if the bulls can defend this level to start with.
Above the 7677 level, and this should be fairly key resistance as we have R1, key fib and daily resistance here, the bulls will be looking for the 7700 round number level, and a possible overshoot of R2 which is at 7690.
7719 is R3 for today – possible but I am also keeping a close eye on the S&P500 as I think any rise may well falter at the R1 level 4131 today. The S&P has also left at gap at 4109 so we will likely see that close initially today.
Will we get a bull Monday? We do of course have the start of the month new money flowing in which may well help the initial kick up so a rise and dip could play out well.
On the news front we have the US ISM Manufacturing PMI at 15:00 – forecasted at 47.5 versus 47.7 previously. The Manufacturing ISM Report On Business is based on data compiled from purchasing and supply executives nationwide. Survey responses reflect the change, if any, in the current month compared to the previous month. For each of the indicators measured (New Orders, Backlog of Orders, New Export Orders, Imports, Production, Supplier Deliveries, Inventories, Customers’ Inventories, Employment and Prices), the report shows the percentage reporting each response, the net difference between the number of responses in the positive economic direction and the negative economic direction, and the diffusion index. A PMI reading above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally declining.
Keep an eye on the 7675 area as resistance, 7630 as support. Good luck today.
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