FTSE 100 live outlook prediction analysis for 17th June 2021
The FTSE100 nearly managed the 7225 resistance level yesterday before selling off and then the Fed drove markets down lower later in the day to a low of 7131 overnight. The bulls have fought back a bit though and we are at 7150 as I write this. The S&P managed to get back above 4200 as well and now needs to defend the 4190-4180 level. If it does so then a rise towards the 2h resistance at 4245-50 may well play out today, though we may well see a stutter here.
Initially on the FTSE 100 I am thinking that we get another dip down to the Fed driven low and also the key fib level at 7125 and at that point the bulls will need to step up. We also have the bottom of the 10 day Raff channel at 7118. A break of that will likely start to see that slide down to the next daily support at 7040 and below S3 for today which is at 7067.
If the bulls do defend the 7125 level and we start to see a bounce then I am expecting a rise towards, initially, the daily pivot at 7177. Above that then R1 at 7206, and we also then have the 7225 level back on the radar. That ties in with the key fib level for today at 7221 as well and a rise to this would all fit pretty well. Cable has moved below the 140 level again and continues to slide which would help the FTSE 100 to push up a bit (lots of FTSE100 companies earn in USD so that helps their revenue).
That said, the 7193 level is the Hull moving average on the 2h chart and therefore that’s the next hurdle after the pivot and before R1 at 7206. The Raff channels remain heading up and the S&P500 is defending the bottom of the 10 day Raff currently at 4200.
Bear in mind that we are getting closer to the seasonal bearish period towards the end of June as well and after the rises this year we may well start to see more profit taking ahead of the summer.
Good luck today and lets see if the bulls can defend again.
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
Markets in London spent the day fluctuating, following news that UK inflation surged above the Bank of England’s 2pc target to 2.1pc. But the pound rose to $1.4110 on the prospect that higher interest rates could arrive sooner than expected. By the session’s end traders had shrugged off a spike in prices for clothing, fuel as well as restaurant meals and the blue-chips ended on a new pandemic high, up 12.47 points to 7,184.95 – the highest closing price since February 2020 for a second consecutive day.
The FTSE 250 spent most of the day in the red or trading flat, before closing 14.06 points down at 22,617.66.
FOMC
The U.S. Federal Reserve sees two rate hikes by the end of 2023. Officials signaled that the pace of the U.S. economic recovery from the pandemic is bringing forward expectations for how quickly they will reduce policy support. Fed chair Jerome Powell told a press conference that officials had begun a discussion about scaling back bond purchases and projected a faster-than-anticipated pace of tightening. Estimates for inflation for the next three years were upgraded. The central bank held the target range for its benchmark policy rate unchanged at zero to 0.25% — where it’s been since March 2020.
Asian Session
Asian stocks and U.S. futures declined Thursday after Federal Reserve officials sped up their expected pace of policy tightening. The dollar and Treasury yields held gains.
An MSCI gauge of Asian shares was on track for its biggest slide in a month, though the number of stocks that rose and fell was evenly split. Japanese stocks underperformed, while Hong Kong shares fluctuated and Chinese equities ticked up. S&P 500 futures slipped after the benchmark closed down, but off its lows as Fed Chair Jerome Powell downplayed the risk of an immediate rate increase. Policy makers disclosed that they expect two hikes by the end of 2023 and would begin a discussion about scaling back bond purchases.
Bonds sank in Australia and New Zealand after Treasury yields jumped as the market repriced the timing of rate increases. Emerging market currencies in Asia tumbled, led by the South Korean won, after a dollar index had its biggest jump in a year. Yield premiums on investment-grade dollar bonds from borrowers in Asia ex-Japan widened.
Elsewhere, the Australian dollar pared some of its overnight losses after employment data beat estimates. Crude oil declined as the strengthening dollar reduced the appeal of commodities priced in the currency. Gold steadied.
[Bloomberg]
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