Technical analysis for FTSE 100 for 24th January 2024
The FTSE 100 was little changed on Tuesday as gains in metal miners were offset by losses in non-life insurers, while investors assessed earnings updates and awaited economic data for more clarity on the Bank of England's monetary easing plans. The blue-chip FTSE 100 index was flat, while the midcap index FTSE 250 slipped 0.4%.
Industrial metal miners were the top gainers, soaring 2.1% in what was their best day in nearly six weeks as most metal prices climbed on a report that Chinese authorities were considering a rescue package for its stock market.
Investors await readings on UK business activity as well as consumer confidence later this week to gauge how the British economy is faring and the BoE's interest rate trajectory.
Asian shares rose on Wednesday on optimism that Chinese authorities will offer support for its stock markets, which have plummeted to multi-year lows, while a hawkish tilt from the Bank of Japan lifted the yen
The MSCI's broadest index of Asia-Pacific shares outside Japan was 0.27% higher. Still, the index is down 5% in January, set for its worst monthly performance since August.
Japan's Nikkei was 0.68% lower, a day after hitting a fresh 34-year high, and the yen strengthened as traders took note of the Bank of Japan's hawkish tilt on Tuesday.
The focus in Asia has squarely been on Chinese equity markets after a wretched start to the year. A report on Tuesday said that authorities were preparing a package of measures worth $278 billion to stabilise the market offered some hope the markets may steady though investors remained sceptical and unimpressed.
Overnight, the S&P 500 climbed to a record high close as investors assessed a mixed bag of early quarterly results.
FTSE 100 technical analysis for today, 24th January 2024
Shorting the rallies played out yesterday and the bears managed to take it all the way down to the 7470 level before the bulls fought back. Overnight we are back above the 7500 level so once again the bulls will want to try and pull away from this, with the 7525 resistance level still the one to break.
7535 is also initial resistance with R1 here, so we could see an early drop off from here, to test the support levels at the 7485 where we have the 2h Hull support. 7473 is also S1 just below that.
The 2h chart remains bullish as you would expect, with the Hull support as mentioned then the green untested coral line at 7461. Should it drop that low then we should see a bounce off this.
The daily chart is more pessimistic, despite the exuberance on the US markets. Both the Raff channels are heading downwards and we have the EMA resistance at the 7578 level. The bulls may well struggle to break through this should we get to that area. Its almost like the FTSE100 isn't buying into the US strength!
Above the 7580 level though its worth mentioned that the 7613 area would be the next level of note, with daily resistance here.
Going back to support and below the 7460 level a slide down to the 7438 S2 level would probably materialise, with 7411 below that. That said, there is a slight underpinning of strength and it will be interesting to see if the FTSE100 can continue to hang on and get a rise towards that 7600 level. The US markets are probably supporting it, even though they aren't lighting the rocket under the FTSE100 bulls.
We have the UK PMI news out at 09:30 so we may well see a bit of volatility kick in then.
Good luck today.
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Two decent reactions at the 7536. First one closed at 7500… #members #trading #ftse100