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FTSE100 live outlook prediction analysis for 17th October 2022
Probably going to be another volatile week as the new Chancellor settles in, and starts to unwind the shambles that was the mini-budget. So far the markets look to be more receptive to Jeremy Hunt so will have to see how it plays out now. The pound has already rallied a bit this morning, and there is an interesting article in Bloomberg this morning saying that now is time to start thinking about buying the dip on UK markets. I’d extend that out to the S&P500 as well in case the traditional seasonality plays out which sees the strength kick in about now for a rise towards the end of the year.
Initially today we are on the 30m resistance at 6855 so we could see a dip and rise play out today, with the 6800 getting tested but then setting up a bounce. The 2h chart is bullish to start with this morning and has coral support at 6845, and then the Hull support at 6830 – though we have already tested that the first time late on Friday and got a small bounce. Out of hours though so will be interesting to see if it holds in hours.
An overshoot off the 6830 down to that 6800 and then climb towards the 6880 level would make sense. Below 6800 then the bear should be able to take it down to the S1 and key fib level at 6775/6769 which may well hold. We could see a bull Monday kick in today too.
For the bulls, they will be looking for a rise to the 6885 level as we have the 200ema 30m here, and also the key fib. Above that then R1 at 6928 would likely be seen. I don’t think they will be able to push towards the round number of 7000 today, but then it does depend how the markets react to the political mess (sorry, situation) that we are in at the moment and if the ship can be stabilised.
Am definitely thinking that buying the dip is starting to become the preferred play now though, especially how it was rallied so hard off 6700 on Thursday last week. The Raff channels are heading down still, but we are now at the mid point of both of them, so could start to see the worm turn.
S&P500
The S&P500 also looks like a buy the dip play is right for today, with the 3582 level looking like decent support. The bulls will need to break above the pivot and 200ema at 3629, as that will allow a test of the 30m coral at 3660, with 3677 above that. 3596 is also the green 2h coral and that line held well on Friday to get a small bounce (when it was at 3590).
Good luck today.
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