FTSE 100 live outlook prediction analysis for 19th April 2021
The FTSE 100 has broken through 7,000 points for the first time in 14 months in a £532bn comeback from pandemic lows, as London stocks were buoyed by surging optimism over the global economy.
Britain’s blue-chip index pushed past the landmark for the first time since February 26 last year as trillions of dollars in stimulus and the growing momentum behind vaccine roll-outs triggered a share “melt-up” and traders bet on a rapid worldwide bounceback.
The FTSE 100 closed 0.5pc or 36.03 points higher at 7019.53, representing a gain of more than 2,000 points from its nadir of 4,993.9 on March 23 last year – the day Prime Minister Boris Johnson announced the first lockdown. It has gained £532bn in value since the Covid crash struck, fuelling a recovery in the value of millions of savers’ pension pots. Experts said the rally still has further to run, with the Bank of England expected to keep interest rates at record lows for the foreseeable future and Rishi Sunak, the Chancellor, spending heavily to support reopening efforts.
The British gains were echoed around the world in a breathless week for financial markets, as a record 18.3pc growth surge for China followed a raft of positive news from America. US house building rose to a 15-year high last month, adding to the mounting evidence of an economic boom after retail sales surged as consumers used their $1,400 (£1,000) stimulus cheques from President Joe Biden. Claims for jobless benefits fell to their lowest level since the pandemic struck this week.
Wall Street’s Dow Jones Industrial Average has also pushed past 34,000 points for the first time, and the S&P 500 reached another record high as Bank of America analysts hailed the impact of $30 trillion of firepower aimed at the crisis by governments and central banks worldwide.
The FTSE 100 is still almost 10pc below the levels reached at the beginning of last year and is lagging behind other markets.
The S&P is already more than 20pc ahead of its February 2020 levels, while the Dow, Germany’s Dax and France’s CAC 40 have also overtaken their pre-pandemic scores. The Dax rose 1.3pc to a new high as Germany’s carmakers were buoyed by the Chinese growth.
Eyes on Recovery
Stocks are set to kick off the week at record highs, with investors focusing on the economic recovery despite mounting concerns about new Covid-19 variants. Futures pointed higher in Japan and Australia after U.S. stocks ended the week at all-time peaks, with the S&P 500 Index capping its fourth straight weekly advance. After two weeks of relentless losses, China Huarong Asset Management bonds rallied after China’s financial regulator said the bad-debt manager had ample liquidity.[Bloomberg]
US & Asia Overnight from Bloomberg
Most Asian shares climbed and U.S. equity futures were steady Monday as the global economic recovery and corporate earnings prospects bolstered sentiment despite rising Covid-19 infections.
Chinese stocks outperformed amid easing concerns about the health of state enterprise China Huarong Asset Management Co., a bad-debt manager. India slid to a two-month low after daily virus cases hit a record. Nasdaq 100 contracts got a boost as Treasury yields eased. European futures rose and S&P 500 contracts were steady after the U.S. gauge chalked a fourth week of gains.
Some risk-off haven demand was evident in the foreign-exchange markets owing to tension between the U.S. and Russia as well as Washington and Beijing. The dollar and yen advanced against their Group-of-10 peers. Bitcoin pared losses after tumbling the most since February over the weekend.
China’s financial regulator on Friday said Huarong had ample liquidity, the first official comments since the company missed a deadline to report earnings. That was enough to cement a rally in Huarong bonds and ease contagion fears.
Robust economic data from China and the U.S. have buoyed investor sentiment, pushing the MSCI All-Country World Index to another record despite concerns surrounding the spread of Covid-19 variants. New infections in the past week surpassed 5.2 million, the most since the pandemic began.
The risk of another destabilizing increase in borrowing costs has also subsided, as bond yields have pulled back from recent highs. This week traders will look for further confirmation of the private sector’s recovery from the pandemic as the earnings season gathers pace.
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
The bulls will be keen to hold the FTSE 100 above the 7000 level and we have bullish support on the 2 hour chart at 6999 to start with today. We also have a green 2h coral with support at 6965 so should the bears have an initial go below 7000 we may well see that level. We had an overshoot of the 7020 resistance level on Friday and should we push past the 7024 30m coral today then we may well see some upside towards the 7044 level where we have the key fib and also R1. I would expect a reaction here though as the S&P is also at a fairly key resistance at 4187.
BItcoin and other cryptos had a wobble on Sunday and that may well cause a bit of a ripple effect across the board as some profit is taken from the recent bullish run. If the S&P cannot push higher than the 4190 level then that may well set the high water mark for the time being.
The S&P looks like it could well pullback towards the 4158 2h coral line and possibly the 200ema on the 30m at 4148 – neatly coinciding with the S2 level for today. If we do drop to there then we may well see that dip get bought up. The bulls need to break above the R1 level at 4194 today though.
Back to the FTSE and we look like we will have an initial dip from the 7015 level which is where we are as I write this, and S1 at 6992 along with the first 2h support may well hold for a bounce back towards the pivot. The charts certainly look like we may well get a dip and rise play out, though on Friday the rise and dip didnt quite play out. Slow reactions maybe and we start to get the dip today?
Below 6965 and the bears will start to get a bit stronger with the bottom of the 10 day Raff channel at 6924 and then the 20 day at 6900. The ball is in the bulls court though and they will need to push towards 7110 where we have the top of both the Raff channels.
For today therefore I am looking at a bit of dip on the FTSE initially down towards the 6965 level. I would like to see the 4150 S&P level hold though otherwise we may well start to see the bears get a bit stronger and we start a pullback.
Good luck today.
Recommended Broker
IC Markets – offers market leading pricing and trading conditions by providing clients with True ECN Connectivity; this allows you to trade on institutional grade liquidity from the world’s leading investment banks, hedge funds and dark pool liquidity execution venues. Highly recommended!
Membership and Live Trading
If you would like more detailed analysis for FTSE 100, DAX, Gold and S&P, including the trades that I am looking to take myself, then please join my active members community.
What you get
- Daily Analysis pre market open (sent around 7am each day) for FTSE, DAX, Gold and S&P.
- Daily email pre market includes my trading plan for the day including ORDER levels, with stops and targets/limits
- Telegram live trading room and webinar group membership for discussion and realtime trade updates
Keep up to date with new content, free sign up below
[yikes-mailchimp form=”4″]