FTSE 100 live outlook prediction analysis for 8th October 2020
The FTSE 100 spent another session on its belly, barely moving in either direction as gains for miners and banks offset losses for asset managers, energy groups and property developers. The blue-chip index closed the day off 3.7 points at 5,946.3.
Yesterdays highlights:
- Pound dips as Brexit tensions grow
- European shares were flat
- Tesco profits surge through pandemic
- House prices jump 7.3pc to nearly £250,000, but boom ‘can’t last’: The post-lockdown property surge meant house prices in September jumped by £17,064 year-on-year to a total of nearly £250,000, but experts have warned the boom will run out of steam soon.
- British negotiators are close to clinching a deal that commits the UK to remaining subject to rulings by the European Court of Human Rights after Brexit.
Markets Lift
Asian stocks looked set for gains after renewed optimism that U.S. lawmakers could still reach an agreement on fiscal stimulus. The dollar slipped. Futures rose in Japan, Hong Kong and Australia, following the S&P 500’s 1.7% overnight advance. Nancy Pelosi signaled openness to an airline-relief bill in talks with Steven Mnuchin after President Donald Trump scuttled broader negotiations. Treasuries declined, sending the 10-year yield up to 0.79%. Oil dropped after U.S. government data showed the first crude stockpile gain in four weeks, adding to concerns over a demand recovery.
Brexit Breakdown, Again
Brexit negotiations are at risk of breaking down within days after the U.K. government warned it will pull out of trade talks with the European Union if there is no clear deal in sight next week. Boris Johnson has said he wants the outlines of a deal to be clear by Oct. 15. EU officials have said they won’t be pressured into making concessions and are prepared to call the prime minister’s bluff if he doesn’t compromise. A person familiar with the British position said Johnson’s team would indeed pull the plug on talks if no clear landing zone for a deal has been identified by that date. The analysis adds to pressure on the talks, which are resuming in London Wednesday, where two key stumbling blocks to a deal remain — whether the U.K. will agree to apply restrictions on state subsidies in a similar way to the EU and the fishing rights for European countries in British waters[Bloomberg]
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
U.S. and European equity futures advanced together with most Asian stocks as investors mulled encouraging signs for Joe Biden in the presidential election race and the outlook for stimulus. Treasuries steadied after yields pushed higher Wednesday.
Shares rose in Australia and Japan, while Hong Kong stocks slipped as a gauge of Asian equities reached the highest level in three weeks. S&P 500 futures edged up following the index’s 1.7% overnight advance, while the dollar dipped. New Zealand’s dollar sank as the central bank indicated a readiness to deploy more stimulus.
We seem to be continuing this consolidation period at the moment as the FTSE slowly grinds up towards the 6000 level once again. The S&P bulls have continued to push on and we have now pushed through the 3420 level that had capped the rise recently. We still look to be on track for a test of the daily coral at 3446, with the top of the 20 day Raff channel at 3490 above that.
As such, we should see the bullishness continue on the FTSE for the moment, and today we look to be on for an initial rise towards R1 and the key fib at the 5990 level. This is just shy of the round number 6000 level which they may well try and go for so a slight overshoot of that resistance level may well take place. Above the 6000 level then we are once again looking at the top of the Raff channels, and the 20 day channel top is at 6050, with the 10 day at 6068 for today. R2 at 6021 first up though on that path. Ultimately, I think that barring anything too unexpected we will rise for the rest of the year (obviously not in a straight line) and I am thinking 6300, 6700+ as the main sort of areas that will be targeted.
Anyway, back to today, and we have initial support from the daily pivot at 5945, and the 200ema on the 30m just below that at 5932. I think that should we get an initial dip then this area will hold as support, but I am also half expecting the bulls to just scream out the blocks and we continue up. The S&P is certainly leading the charge. Buy the dip remains the play still. 5939 is also the 2 hour coral, now green, showing a firm uptrend.
So expecting a rise and then possible pull back later, if the consolidation continues to build a base for a bigger push as the US election gets closer. Bit of political wrangling in the UK going on too, with Boris facing a bit of rebellion. Brexit simmers away in the meantime too, with the usual bickering that they always do as they negotiate. The oven for the oven ready deal doesn’t seem to be turned on at the moment!
Anyway, back to the FTSE and watch the 5940 area for support, with 5912 below that. 5990 and 6021 for resistance above that. Good luck today.
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