Bulls continue to push towards 7450 | 7380 7363 7335 support | 7416 7444 resistance

Welcome back with 2020 off to a lively start already | 7595 7640 resistance to watch today | Short the rallies

FTSE 100 Outlook and analysis for 5th November 2019

  • European stock markets hit highest level since 2015
  • Dow Jones Industrial Average breaks July record as major US indices push to new highs
  • FTSE 100 advances strongly as pound slips

Global markets pushed to record highs amid optimism that a deal will be reached between the United States and China to end the long-running trade dispute between the world’s two biggest economies. The Europe-wide Stoxx 600 index hit its highest level, while in the US the Dow Jones Industrial Average finally joined the S&P 500 and Nasdaq in re-entering record-high territory.

It was a bumper day for European stocks, with Germany’s Dax index leading top blue-chip risers with a 1.35pc gain. France’s Cac also broke a rise of 1pc.

The FTSE 100 lagged a little behind, given an extra lift by weakness in the pound, which fell slightly to just above $1.29 at the closing bell in London. The currency has been more or less flat for almost two weeks, seemingly put on hold as traders wait for clearer signs to emerge from Britain’s impending general election, which is expected to dictate the future of Brexit.

Today’s news highlights include UK Markit Services PMI, EZ PPI, US International Trade, Markit Services and Composite PMI, ISM Non-manufacturing PMI, JOLTS, ECB’s Villeroy, Fed’s Barkin, Kaplan, Kashkari, Riksbank’s Ingves, supply from the UK & US.

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

Well the trade deal hopes have certainly put a rocket under the markets and the FTSE has broken above the 7330 level fairly convincingly now. The 7250 daily support we saw last week has certainly held well and seen a decent rise! The bulls will now be targeting the 7444 level where we have a gap to close, and is also R2 for today, along with the top of the 20 day Raff at 7453.

How things can quickly change when the news flow does, only last Thursday it was all doom and gloom! The slight spanner in the works for the rocket propelled climb is that the fear/greed indicator is now at 86/100. Though as you know, markets can remain irrational for longer than you can remain solvent!

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

Initially we have resistance at the 7415 level with R1 and a key fib level where, and as such may well see a dip down from here towards yesterdays closing price at 7369, though we have 30min support at 7380 just above that with the moving average and coral line. As such we may not drop all the way to the 7369. That said, if the bears were to take control today though a break below 7360 then a test of the 2 hour supports at 7328 and 7310 looks likely, where we have the moving average and the coral line respectively.

The sentiment though is bullish, especially helped by the recent rate cuts, progress on the trade war between China and the US and as such we may well see a push towards the 7450 level today where we have the top of the 20 day Raff channel.  Then 7470 for the top of the 10 day channel. Should the bulls break this then the 7499 level looks possible, and just above R3 for today at 7495. Another 100 point rise on a potential bear Tuesday might be a bit much though but bear it in mind. I don’t think we will break above 7450 today unless there is a news driven move.

The S&P has stalled at the 3085 level after a strong rise yesterday but the top of the 10 day channel is now at 3110!

So for today looking at the 7380 and 7330 levels for support, and the 7415 and 7450 levels as resistance.

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