Technical analysis for FTSE 100 for 6th September 2023
The FTSE 100 closed 0.20pc lower at 7,437.93. The FTSE 250 midcap index tumbled 0.18pc to 18,491.42. The FTSE 100 surged during early trading, with BP and Shell among the top risers amid rising oil prices.
APAC stocks traded mostly in the red following the subdued handover from Wall Street where sentiment was clouded by the higher yield environment. European equity futures are indicative of a lower open with Euro Stoxx 50 future -0.4% after the cash market closed down 0.3% yesterday.
World stock indexes eased and benchmark 10-year Treasury yields rose to their highest in more than a week on Tuesday as oil prices jumped and investors weighed prospects for further U.S. interest rate hikes.
Orders for U.S. factory goods declined less than expected in July, according to data.
At the same time, economic data in China and Europe fueled some worries about slowing global growth.
FTSE 100 technical analysis for today, 6th September 2023
A frustrating overshoot of the 7410 support level yesterday but the bulls managed to fight back from 7388 to almost reach the 7486 resistance before we sold off again. That weakness has continued overnight and if 7388 breaks today will likely see a slide down to the 7338 support level next.
The S&P500 continues to look weak to start September though the bulls are desperately trying to defend the 4490 level at the moment. A break of that will likely see a slide down towards S3 and the bottom of the 10d Raff channel at the 4460 area.
Initially for the FTSE 100, I am thinking that we will see a bounce to test the 7447 200ema level and another test of the Hull MA on the 2h chart. That was the line that we dropped off yesterday and is the level that the bulls will need to break.
We are just on the bottom of the 10d Raff channel to start with today at 7405 and that could lend some weight to an early bounce, more likely from yesterdays low at 7388.
Generally today looks like we might see the opposite pattern to yesterday with rise dip rise playing out instead.
If the bulls can break 7450 though then the next level of resistance remains at the 7525 area, with 7580 above that. Probably not today for that though!
Below the 7340 level then it will start to get really bearish, with 7290 S3 and a break from the typical seasonal play of a rise and dip during September. Oil continues to tick up in price, along with a bit more fear kicking in. Rate rises may well see a pause this month as it feels like they are starting to have an effect now, and the US is certainly faring better than the UK at the moment looking at the various bits of data. Inflation still stubbornly high here.
Good luck today, watch 7388, 7340 for support. 7450, 7480 and 7525 for resistance.
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