Technical analysis for FTSE 100 for 27th February 2024
Britain’s stock indexes edged lower on Monday as miners lost ground due to weaker copper and iron ore prices, while declines in homebuilders followed the UK antitrust watchdog’s launch of an investigation into the sector.
The resource-heavy FTSE 100 index and the mid-cap FTSE 250 closed the session about 0.3% lower.
Waning bets of an interest rate cut from the Bank of England pushed the FTSE 100 lower last week, with U.S. and European consumer prices data later this week likely to test investor sentiment further.
Stocks stall
US stocks lost steam near record highs as traders braced for a barrage of economic data and remarks from Federal Reserve speakers that will help shape the outlook for interest rates. The S&P 500 fell to around 5,070, although Nvidia rose to a record. Meanwhile, Amazon effectively joined the Dow Jones Industrial Average. Stock markets have room to extend gains beyond record highs if the economic outlook remains upbeat and investors pour money into recent laggards, according to Goldman Sachs Group. Treasury 10-year yields increased three basis points to 4.28%. Investors piled into an intermediate-term Treasury ETF at the fastest pace on record last week as hopes fade that the Fed will cut interest rates rapidly this year. The Fed’s favored inflation gauge is projected to show the biggest rise in a year. Bitcoin climbed above $54,000.
Asia
Asian shares struggled to advance on Tuesday, with slightly warmer-than-expected Japanese inflation putting investors on guard ahead of price data due in Europe and the U.S. this week.
Tokyo’s Nikkei crept 0.4% higher to eke a fresh record high. MSCI’s broadest index of Asia-Pacific shares outside Japan was flat, keeping beneath last week’s seven-month peak.
FTSE 100 technical analysis for today, 27th February 2024
Fairly quiet day yesterday as the markets catch their breath which may well roll into a bear Tuesday today.
Initially I am looking at resistance at the daily pivot at the 7691 level and if we get an early rise then we may well see the bears have a go here and try and keep the bearish momentum from yesterday going. The bulls failing to hold on above the 7700 level yesterday still suggests some profit taking, likewise with the S&P500 dropping back from the 5100 level.
There is still the chance that it’s come too far too fast, so a bit of a breather while we await the next catalyst to see the break one way or the other may well be playing out. We have a fair bit of data out this week as well, starting with the US Durable Goods (1330) and CB Consumer confidence (1500).
Above the 7691 level then 7715 area still remains as per yesterdays email, and 7708 is also R1. Should we see the bulls push on though and possibly break this then a test of the 7750 level still looks likely.
For the bears then a test of 7650 may well play out and I would like to see this hold to set up a bounce, as we have S2 here and it is also the bottom of the 10d Raff channel. The Raffs continue to head upwards and the 7644 level is also the 25ema – that would be the second test of that moving average so again, it would be good to see that hold also. We are in “extreme greed” at the moment still so a bit of a breather and consolidation would make sense.
Below the 7650 level then 7634 and 7625 are the next levels of note with 7575 lower down, though unless something bad happens I am not expecting it to get that low.
Good luck today.
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