FTSE 100 live outlook prediction analysis for 3rd June 2020
London’s benchmark indices ended near three-month highs on Tuesday as traders hoped fresh government stimulus could fuel a faster recovery as coronavirus lockdown eased. Both the FTSE 100 and FTSE 250 closed up nearly 1pc, at their highest levels since early March, boosted by hopes the Chancellor could bring in a National Insurance contribution holiday for employers.
Sterling, meanwhile, pushed to its highest level in more than a month as crunch talks between UK and European Union officials over future trading relations kicked off, focused on the fraught issue of fishing rights – a tiny part of Britain’s economy, but one that has become a key symbol of the Brexit debate. Cable climbed as high as $1.2576 on its fourth consecutive day of gains, topping off a 1.2pc jump on Monday, amid reports that both sides are considering ways to move forward.
European markets shot higher, with the FTSE 100 trailing the pack as the stronger pound put pressure on international earners. Most of Britain’s blue-chips eked out gains on a quiet day for data and reporting, with only backwards-looking data on consumer credit and mortgages for investors to chew on.
Trump Under Fire
U.S. President Donald Trump came under harsh criticism from religious leaders and Democrats for the government’s violent dispersal of a peaceful protest outside the White House on Monday, while some Republicans expressed disapproval and the U.S. military distanced itself from the episode. The Catholic archbishop of Washington said it was “reprehensible” for a shrine to Saint John Paul II in the city to host Trump. The president’s presumptive re-election challenger, former Vice President Joe Biden, said in a speech that the country is “crying out for leadership.” Two Republican senators said they did not support the use of tear gas, rubber bullets and flash-bang devices to disperse protesters gathered Monday in Lafayette Square, across the street from the White House. Trump has championed an authoritarian government response to nationwide protests over the death of an unarmed black man in Minneapolis police custody last week. Pentagon officials on Tuesday distanced themselves from both the police actions in Lafayette Square and Trump’s threat to use the military.[Bloomberg]
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
The global rally in stocks showed no signs of abating Wednesday as investors continued to bet on a quick economic recovery from the coronavirus pandemic. The dollar hit the lowest level since late March. South Korean shares led gains in Asia after the country detailed a third round of fiscal stimulus. Indonesia’s rupiah was the outperformer in currencies, after record orders at a local bond auction. Treasuries dipped. U.S. equity futures pushed up after the S&P 500 closed at its highest since early March. Brent crude extended its rebound above $40 as investors eyed a potential extension of record production curbs by OPEC+.
We have had more bullishness overnight and are now testing the 6280 resistance level as I write this, and this level is one where I was expecting a bit of a stutter. As such we may well see a bit of an initial dip form here, towards the 6250 support level where we have the 30min coral. It appears that we may well have further upside today though towards the 6350 resistance level, especially as the bulls managed to keep things moving upwards yesterday. We have R2 just above this 6280 level, at 6296. The S&P has also managed to get close to the 3100 resistance level overnight so the bulls will be keen to push past both of these areas. This R1-R2 area is resistance for today at 3095 to 3111 so the bulls might struggle to push past this, if the bears appear then we may see the tide turn, otherwise 3140 and R3 is likely to be tested today.
Above 6350 then the top of the 10 day Raff channel at 6404 is worth keeping an eye on. Both Raff channels are still heading upwards. 6400 would therefore be worth a short if we were to get that high today.
We could well see a test of the 200ema on the daily chart at 6616 currently (slowly declining so around 6600 in due course) if the bulls can maintain this momentum for the next few sessions – that would be the first test of that level since the cross over on 21st February so looks pretty key if we do get up to that area in the next couple of weeks. Whilst looking at the daily chart, the daily coral is green still with this uptrend but shows support down at 5575 currently – so if there was another large leg down then this area (5600 and a 1000 point drop?) would probably hold as support. Bit of bigger picture outlook info there for you!
If the bears were to break below the 6250 level today then the daily pivot is the next support level I am looking at which sits at 6212 with the 6180 level below that which is the level that held yesterday. We have S1, 200ema 30min, and a key fib level all in this area so should the bears take it that low then we should in theory see this area hold. With a bullish Asia and ASX200 today though, that enthusiasm may well carry through to the FTSE as traders bank on a recovery from the pandemic.
So, generally for today expecting more upside, but as we are nearing key resistance on the SP and also the round number at 6300 we may see some bearishness. However, whilst it’s still buy the dip for the moment, and looking at 6250, 6212 as support, we are also approaching some fairly key resistance levels at 3110(S&P), 6350(FTSE100), 12400 (Dax). Good luck today.
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