Bull Monday with 7200 defended and still support | 7188 7138 below | 7275 7335 resistance

Bull Monday with 7200 defended and still support | 7188 7138 below | 7275 7335 resistance

FTSE 100 Analysis | Trading Signals | Forecast | Prediction | FTSE 100 Outlook | Trading help

The FTSE 100 closed lower on Friday amid worries of a fresh wave of coronavirus infections in the Continent. London’s main index fell 0.4pc to 7,227.

European stocks fell on Friday as fears of fresh lockdowns rocked the continent. The eurozone risks plunging into its third Covid slump this winter as Germany and Austria move to stamp out soaring cases. Forecasters warned renewed restrictions will slow the recovery and could even trigger another contraction in the fourth quarter as the euro and eurozone stock markets were sent sliding by rising lockdown fears.

Asian stocks were mixed and U.S. futures rose as traders weighed European Covid curbs and the risk of a faster Federal Reserve taper. The Treasury yield curve was near the flattest since the pandemic began.

Equities outperformed Monday in South Korea — aided by robust export data — and climbed in China, whose central bank signaled possible easing to support a slowing economy. U.S. futures edged higher after a flavor of the stay-at-home trade on Friday saw economically sensitive sectors drag down the S&P 500 while the technology-heavy Nasdaq 100 advanced.

Global equities remain near records, coping with a litany of worries including a winter virus wave and elevated inflation that may force more rapid Fed tightening. Other uncertainties include who President Joe Biden will pick as the Fed chair nominee from Governor Lael Brainard and incumbent Jerome Powell, as well as the perennial saga over suspending or lifting the U.S. debt limit.

A trio of Fed policy makers — Vice Chairman Richard Clarida, Governor Christopher Waller and St. Louis Federal Reserve Bank President James Bullard — have signaled that the topic of a faster taper might be on the table when the Federal Open Market Committee meets in December.

Former U.S. Secretary of State Henry Kissinger says he doesn’t foresee a Chinese military invasion of Taiwan in the next decade, though it’s “perfectly possible” that China will seek to weaken the island’s status. China downgraded ties with Lithuania and is prepared to end diplomatic relations with the Baltic nation if need be after Taiwan opened a diplomatic office there. France warned of “grave consequences” if Russia invades Ukraine and expressed concern over a buildup of Russian forces along the border. Sources say the U.S. shared intelligence with European allies showing Russian troops and artillery positioned for a rapid, large-scale push into Ukraine from multiple locations — though Vladimir Putin’s intentions remain unclear.

FTSE 100 live outlook prediction analysis for 22nd November 2021

Having tested the 7200 level on Friday the bulls have managed to fight back a bit and get a bit of a bounce going. However the 2h chart remains bearish with the red coral resistance at 7275, and that ties in with the R1, key fib and 200ema there on the 30m chart, so should we get a climb to there during this morning then we could see the bears have another go here.

With the weakness from 7400 it has enabled the daily RSI(10) to reset to a much lower level from its overbought set up, and as such could pave the way for the year end strength. Its also Thanksgiving week in the US this week, so a shorter trading week and traditionally we see bullishness this week. The bulls will be keen to defend the 7200 level and 4700 on the S&P. Below 4700 then 4675 (Thursdays low) will need to hold otherwise the bears may well take control.

If we do defend any drop down to 7200 today then I would like to see that bounce to 7275 as mentioned, and above that then 7300 is the next round number area of interest, with R2 at 7335 above that. I think that could be a big ask for today though and further consolidation today above 7200 and below 7275 would set the scene for more strength as the week progresses.

Below the 7200 level then 7188 is the key fib, along with the bottom of the 10 day Raff at 7173. 7200 is the bottom of the 20day Raff and also the first test of the daily green coral support line, which is why I am continuing to lend weight to 7200 holding. 7138 is then below the 10 day Raff channel and as with the S&P500, a break of the key support (7200, maybe 7170) would likely get things bearish. I am not expecting 100 points to come off today though – bull Monday and seasonal strength likely to pay a part in supporting the bulls today/this week. 7150 is also daily support which should see a bounce should it drop to there though.

No massive market breaking news today but highlights include EZ Consumer Confidence (Flash), US Existing Home Sales, ECB’s de Guindos and Holzmann, and supply from the US.

The S&P has initial resistance on the 2h at 4713, and the bulls will be keen to push past this for a test of the 4733 key fib level. A break of 4700 though and 4684 is S1 and would be the target for the bears, but we do have the round number 4700 and 200ema here which was defended on Friday. The Raff channels remain bullish though.

The Dax has now got a red coral on the 2h chart with resistance at 16261 so with the key fib just above here as well we may well see any rises stutter in this area.

So, thinking a bull Monday with a rise towards the 7275 level this morning, after a small dip possibly. Still buy the dip really for the moment, with the S&P500 bulls seeking to break the initial resistance at the 4713 level.

Good luck today.

Recommended Broker

IC Markets – offers market leading pricing and trading conditions by providing clients with True ECN Connectivity; this allows you to trade on institutional grade liquidity from the world’s leading investment banks, hedge funds and dark pool liquidity execution venues. Highly recommended!

Membership and Live Trading

If you would like more detailed analysis for FTSE 100, DAX, Gold and S&P, including the trades that I am looking to take myself, then please join my active members community.

What you get

  • Daily Analysis pre market open (sent around 7am each day) for FTSE, DAX, Gold and S&P.
  • Daily email pre market includes my trading plan for the day including ORDER levels, with stops and targets/limits
  • Telegram live trading room and webinar group membership for discussion and realtime trade updates

Keep up to date with new content, free sign up below

[yikes-mailchimp form=”4″]