Technical analysis for FTSE 100 for 26th March 2025
Yet again the 8610 support level holds, and we got another attempt yesterday to break the 8700 level. It looks more likely to break and hold above today though as the 2h chart has gone bullish with 8654 now locked in as Hull MA support. For today therefore I am expecting some more upside, and we have just had inflation data out which has fallen unexpectedly in a boost to Rachel Reeves as she prepares to announce cuts to public spending in her Spring Statement.
The consumer prices index (CPI) eased from 3pc in January to 2.8pc in February, according to the Office for National Statistics (ONS). If it drops again for March then I still think a small rate cut in May is likely, especially as the economy continues to slow down.
It will be interesting to hear the Spring Statement later, as public sector cuts are expected to feature, and maybe some heckling over the abuse of credit cards by civil servants. Circa £500m "wasted" on luxuries last year!
So initial support is at the 8655 level and just below the daily pivot so the bulls will be keen to climb off this. That would allow a rise towards the 8730 area where we have R1 and key fib level, and may well see a stall as it aligns with the recent high at 8743 area. If the bulls were finally able to break above 8743 then I am still hopeful for a rise towards the 8800 level. 8790 is daily resistance just below this, with 8835 for R3.
Support wise, if they break the 8650 level then 8610 is still in play with 8580 below that. However I am expecting a bullish day today unless Rachel Reeves scuppers it. The US markets are continuing the recovery and the S&P continues to push on, looking to break above the 5600 level soon. It's desperately trying to break the 25ema daily resistance level at 5773 currently, and with a lacklustre bearish reaction on the first test of this yesterday the bulls will be confident they can.
Generally then the "buy the dip" stance remains the right one and the daily chart is on the cusp of having bullish EMAs again too. The 25ema now showing some support at the 8670 level. The 10d Raff channel is now also heading upwards at steeper angle.
So look for a rise towards the 8740 area again today for the FTSE100.
The Dax40 needs to break above the 23220 level initially but any drop back to the decent support level at the 22900 level is worth a long as we have both S1 and the key fib here, along with the 2h Hull MA support. If this were to be tested then I would like to see this hold.
The S&P500 is also bullish, with the 5766 Hull MA support being tested first thing.
Good luck today.
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