Bull Monday with US closed | 7040 7100 7135 resistance | 6965 6905 support

Bull Monday with US closed | 7040 7100 7135 resistance | 6965 6905 support

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

The index ended Friday 0.4pc lower at 7,016. It came a day after the blue-chip index had given back more than 3pc of its value in the worst performance since early March, a day when a nuclear power plant in Ukraine was on fire.

Most Asian stocks fell Monday and iron ore sank as concerns about a wave of monetary tightening and slowing growth hurt sentiment.

MSCI Inc.’s index of Asia-Pacific shares dropped for an eighth day, the longest such stretch since February 2020. China managed to buck the wider trend, continuing a recent spell of outperformance amid global weakness.

S&P 500 and Nasdaq 100 contracts were in the green but off session highs. A dollar gauge edged lower. Economic pessimism weighed on commodities: crude oil added to a near-7% Friday plunge, while iron ore sank about 7%.

Bitcoin slid back below the closely-watched $20,000 mark. A volatile crypto slump has become emblematic of the pressure on a range of assets from sharp Federal Reserve interest-rate hikes to tame high inflation.

Treasury futures advanced — there’s no cash trading due to a US holiday.

Dire Strait
Biden administration officials rejected a vague new assertion by China that the Taiwan Strait is not “international waters” and are worried the stance could result in more frequent challenges at sea for the democratically governed island. Chinese officials have made such remarks repeatedly in meetings with US counterparts in recent months, Bloomberg reported last week, raising the prospect that China could be preparing a new challenge to US regional influence and military power. It’s unclear what China means by “international waters,” but the language may be intended to deter the US from sailing through the strait. Meanwhile, two leading US senators are seeking an overhaul of Taiwan policy, saying they want to deter any possible invasion of the island by China after witnessing Russia’s attack on Ukraine.

Inflation Woes
Stocks are set for a cautious start to the week as sentiment in markets remains fragile under a Federal Reserve determined to tame inflation.
Equity futures rose for Japan but dipped for Australia and Hong Kong, while S&P 500 and Nadsaq 100 contracts edged up in early Asian trading. Volatility is likely to continue to whipsaw markets as inflation remains elevated and investors fret that assets have further to decline. Treasury Secretary Janet Yellen said that “unacceptably high” prices are likely to stick with consumers through 2022 and that she expects the US economy to slow down.

FTSE 100 live outlook prediction analysis for 20th June 2022

We are just below the 7000 level as I write this but with the US having a holiday today we may well see a drift type day – most likely up towards the 7040 daily pivot area to start with, then a drop back before a slow rise this afternoon. The bulls will be keen to defend this 7000 level as a proper break of that leads down to the 20d Raff at 6928, and possibly as low as the next daily support of 6800 below that on the longer timeframes.

Above the 7040 level then the bulls could be looking to test 7100 where we have the red 2h coral, though not the first test of that, and then above that we have the 200ema on the 30m at 7140. Seems a big ask for today with the current pessimistic vibes prevalent everywhere, and just holding 7000 is a decent sign.

The daily chart remains bearish with key resistance at the 7350 level for the moment – 200ema and 25ema both here – so should we see a test of these MA lines this week (they will gradually move lower as we move along) then we may well see the bears have another reload here.

The crypto losses continue to weigh on sentiment for the time being as people realise that BTC isn’t quite the ” safe haven” they thought it was. Still thinking this could get as low as $7k though…..

For the FTSE100 bears today then they will be looking to keep the price below 7000, and a drop down to 6965 looks possible. There is decent support here on various time frames, along with S1 at 6957, so we may well see this hold for today. A weak bull Monday on the cards possibly!

Below 6957 then 6904 is S2 and would probably get seen as the bears take control and the bulls scarper! Personally I dont think we will get that low today, 6965 may well hold if tested, but initially I am thing that we get a rise towards the 7040 area.

Good luck today!

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