FTSE 100 live outlook prediction analysis for 9th September 2020
We got the rise as expected, and a bit stronger yesterday too, and the FTSE managed to push back past the 6000 level, as the S&P regained 3400. However, overnight the FTSE has been consolidating around this level ahead of a possible push towards 6100. The main events yesterday:
- Pound extends fall: Sterling dropped to as six-week low against the dollar as it notched up its biggest losing streak since March.
- Firms demand urgent support as Covid restrictions tighten: Industry chiefs have called for urgent support for businesses amid warnings that tighter restrictions on social gatherings could deal a further body blow to consumer confidence.
- Pizza Hut to shut 29 UK restaurants: Pizza Hut has announced plans to shut 29 restaurants, putting 450 jobs at risk as it becomes the latest chain to scale back in the wake of the coronavirus pandemic.
- New Look appeals for landlords to back last-ditch rescue: New Look has warned it could collapse if landlords do not agree to a controversial restructuring deal to allow it to pay cheaper rents.
- Ryanair’s Michael O’Leary declares winter a ‘write-off’ for travel industry: Ryanair chief executive Michael O’Leary has warned that the winter will be a “write-off” for the travel industry as the carrier cut its annual passenger target by a further 17pc.
A string of City analysts are predicting a no-deal Brexit amid growing fears talks with the European Union will collapse. Credit rating agency Fitch expects the UK to deal with the EU on World Trade Organisation (WTO) terms from Jan 1 as a row grows over changes to the Withdrawal Agreement which would violate international law. Fitch expects a sizeable economic hit from the disruption this would cause as businesses are hit by tariffs and red tape as result.
Donald Downplays
President Donald Trump defended telling a journalist that he intentionally downplayed the severity of the coronavirus in public, saying he didn’t want to cause panic or price spikes. “I wanted to always play it down, I still like playing it down, because I don’t want to create a panic,” Trump told Bob Woodward, the author and associate editor for the Washington Post, on March 19 in one of a series of interviews for his book, “Rage,” due for publication this month. Trump insisted he was right to keep his concerns about the virus private. Joe Biden, meanwhile, said the president was responsible for the deaths of tens of thousands of Americans for failing to adequately warn about the danger from the coronavirus.[Bloomberg]
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
The rebound in global stocks eased on Thursday as investors weighed whether a recovery in technology shares could overcome lingering concern about valuations. The dollar steadied after declines.
U.S. and European futures edged lower, while equities in Japan and China retreated from session highs. Stocks in Hong Kong fluctuated. Earlier, the S&P 500 rose the most since June overnight and the Nasdaq rebounded following an 11% rout that took the gauge down to its 50-day moving average, a closely-watched technical level. Indonesian shares slumped after officials said the capital, Jakarta, will bring back social distancing measures due to a spike in Covid-19 cases.
The bulls put up a good fight yesterday and will be keen to defend the 6000 level now, but a dip down to the 200ema at 5940 looks to be a good place for a long, especially if the S&P can also build on its gains and pull away from the 3400 level (targeting 3500 still). Buy the dip still looks to be the sound strategy for the moment. The 2 hour chart for the S&P has good looking support at 3348 now, so a dip to that area is worth a long.
The however though is that we are sat at the top of both the Raff channels on the daily chart for the FTSE with resistance at the 6030 level from them, and they have capped the overnight strength. We therefore may well see an initial dip this morning if those levels hold as resistance. We also have the key fib resistance for today at 6029 to start things off, as well as this area being the overnight high. If the bulls can push past the 6030 level today then we should be on for the 6100 level, just above R1 at 6086 for today. I am however watching the top of those Raffs initially at 6030, a break of them and it will be worth taking a long for the breakout.
For support, if we do break the 6000 level initially, then 5941 is the main area of support that I am looking at. Below this then S1 at 5917. I am not expecting it to get that low today though, though do keep an eye on cable as that is driving the FTSE 100 pretty well at the moment. General rule is if cable drops FTSE rises and vice versa, though thats a bit of a simplification.
So, not too much more to say really, watching 6030 and 6087 and 6100 for resistance, 5977 (daily pivot)and 5940 as the main supports. Favouring buy the dip and the S&P to rise towards 3500, as long as any dip down to 3350ish holds. Good luck today.
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