FTSE100 Analysis | Signals | Forecast | Prediction | FTSE 100 Outlook | Trading help
The FTSE 100 was subdued during the session as mixed earnings and worries about the economic outlook outweighed relief following the US Federal Reserve’s less hawkish comments that had spurred an overnight rally on Wall Street. The blue-chip index closed flat at 7,345. The long from 7315 slowly motored and then took off in the evening, with futures rising to 7410.
US equity futures climbed Friday on positive earnings from Amazon.com Inc. and Apple Inc. and expectations of shallower Federal Reserve monetary tightening, a prospect that’s also supporting Treasuries.
Nasdaq 100 contracts added more than 1% after the US stock market hit a seven-week high Thursday. Amazon jumped over 13% in extended trading, while Apple also advanced, after their revenues beat estimates.
Joe Biden has insisted that the US is not in a recession despite after official figures showed the world’s biggest economy had shrunk in two consecutive quarters. The US President said the downturn was “no surprise”, pinning it on waning momentum and the Federal Reserve’s efforts to curb inflation. But pointing to record low unemployment, he added: “That doesn’t sound like a recession to me.”
GDP fell at an annualised pace of 0.9pc between April and June, compounding a 1.6pc decline in the first quarter.
Asian stocks took their cue on Friday from a late rally on Wall Street, as markets focused on a possible slowdown in the pace of rate hikes rather than a U.S. recession after data showed its economy shrinking for a second straight quarter.
Economists are debating whether the world’s biggest economy is already in or on the verge of a recession, as it battles its highest inflation in four decades and gross domestic product shrinks – at a 0.9% annualized rate last quarter, after a 1.6% contraction in the quarter before that.
The Federal Reserve delivered another aggressive interest rate hike of 75 basis points this week, its third this year.
Meanwhile, China, still in the throes of COVID-19 outbreaks and lockdowns, did not mention its full-year GDP growth target after a high-level Communist Party meeting and said instead it will try hard to achieve the best possible results for the economy this year.
U.S. equities, however, rallied this week as comments by Federal Reserve Chair Jerome Powell led to speculation that rate hikes would begin to slow and eventually turn to rate cuts in 2023. Shares of Amazon and Apple shot up 12% and 3% each after hours after the tech giants reported earnings that beat expectations.
The Dow Jones Industrial Average rose 332.04 points, or 1.03%, to 32,529.63, the S&P 500 gained 48.82 points, or 1.21%, to 4,072.43 and the Nasdaq Composite added 130.17 points, or 1.08%, to 12,162.59.
FTSE100 live outlook prediction analysis for 29th July 2022
That was a good rise after the bell but the bears have dropped it back overnight. We may well see another attempt at a push towards that 7425 resistance level where we have R1 for today to start with. If we do, then we may well see the bears reappear here for a push down to gap close with yesterday’s closing price, at the 7345 level.
That said there is initial support at the 7360 area where we have the 30m coral and the daily pivot, and has held overnight as support.
Above the 7425 level then the bulls will be aiming to cement the rise from yesterday and push up towards the 7468 R2 level, but also more significantly the 7500 level. The daily Raff channels continue to head up steeply, though we are still only around the mid point of both channels. More upside to come? The S&P500 (and the FTSE100) have both broken upwards so we may well see a period of positivity…. though how long it will last remains to be seen.
For the bears, 7360 support as mentioned and then the 7335 200ema on the 30m below that. The daily EMAs are still bullish of course, and the support from them is at 7270 for today. I don’t think we will get that low (especially as the US will be keen to push on today and pull away from the 4100 level) but bear it in mind.
As per yesterday it’s buy the dip really.
Slight word of warning for those that don’t know, as its Friday it can pay to be a little bit more cautious – lower stakes etc as you can get whippy moves.
Good luck today and have a great weekend!
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