Technical analysis for FTSE 100 for 20th February 2025
Amazing drop on the Dax40 yesterday and was nice to short right at the high of the day! That also carried through into the FTSE100 which failed to break above the 8780 level. For today, we may well see the bears try and break below the 8700 level to test the 8650 support area. The S&P500 also dropped off the Hull MA yesterday and the bears will be looking to break 6100 on that.
Initially we have resistance at the daily pivot level at 8715, with a potential test of the now bearish Hull MA at 8730 above that. Worth a short here in case we do get the leg down towards the 8650 area. Its all kicking off with the "peace" talks with Trump wanting a return on the circa $300bn spent by the USA as part of any deal and Ukraine not willing to pay the bill... or so the media is saying anyway.
Above the 8730 level, then the bulls would be aiming for the 8770 key fib, if they can break R1 at 8755, with 8816 R2 above but looking rather optimistic. The daily resistance level is still at 8821 so should it get to this then a short here is also worth a go. Seems unlikely today though!
For the bears, should 8650 break then 8628 is the 25ema on the daily and 8614 for S2. However, there is also daily support at 8629 - again, that might be a bit extreme for today to get down there, but given the pessimism in the MSM about the UK economy, the high street and business woes, its going to have an effect on sentiment.
Further tax rises look imminent in March in yet another manifesto pledge breakage, along with a reduction in cash ISA amounts - total holdings and contributions by the sound of it. On the flip side, that may encourage more to invest in stocks & shares ISAs instead so will help indices!
We may well have a 8650 to 8735 range play out today, and it will be interesting to see if the bulls defend the 8700 early on. We are just testing the bottom of the 20d Raff channel around the 8690 level at the moment and as both the Raff channels are still rising the bulls will certainly be looking to defend.
On the news front today the main ones are at 1330 with US initial jobless claims, with a forecast of 215k versus 213k previously. We also have the Philadelphia Federal Reserve Manufacturing Index at 1330 with a forecasted drop to 19.4 from 44.3 previously. If so then the bears may well latch onto that.
Good luck today.
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