Technical analysis for FTSE 100 for 12th March 2024
The UK's benchmark FTSE 100 eked out modest gains on Monday supported by a rise in shares of non-life insurers, while traders refrained from placing large bets ahead of U.S. inflation data later in the week. The blue-chip FTSE 100 edged 0.1% higher, while the midcap index FTSE 250 slid 0.4%.
Markets this week are squarely focussed on U.S. consumer prices and domestic labour market data, both due on Tuesday, which would likely guide interest rate expectations from the central banks.
Money markets are currently pricing in about 67 basis points of interest rate cuts from the Bank of England (BoE) this year.
A survey showed Britain's labour market slowed sharply in February, as recruitment firms reported their biggest drop in demand for staff from employers since early 2021.
Asia
Asian stocks nudged higher on Tuesday ahead of the influential U.S. inflation report, while Japanese shares fell and the yen firmed on rising expectations that the Bank of Japan may be ready to exit ultra easy-monetary policy as early as next week.
Gold was hovering just below its record peak touched last week and the dollar was broadly steady as traders looked for the U.S. consumer price index report later in the day to gauge when the Federal Reserve will likely start its rate cutting cycle.
MSCI's broadest index of Asia-Pacific shares outside Japan was 0.20% higher, just shy of the seven-month high it touched on Friday. China stocks rose, with Hong Kong's Hang Seng Index up 0.75% led by tech stocks, while the blue-chip CSI300 index 0.13% higher.
FTSE 100 technical analysis for today, 12th March 2024
Dropped off just shy of the 7670 resistance level but good to catch the short at 7665 in the end. That got a drop to 7610 which has set up a decent bounce and looks like the bulls did not want it to drop lower than 7600. We have now tested the 7734 daily resistance level overnight, and we also have R1 here, so we may well see another dip and rise play out.
The main support to start with today is now at the 7675 area where we have a cluster of them - the daily pivot, 30m coral and the 30m 200ema. We also have 2h support here as given the climb from 7610, that time frame is now bullish, and has Hull MA support at the 7675 and a green coral at 7668. As such I would like to see any drop down to here to hold and set up a bounce.
Should that break though then 7610 being yesterdays low would be next up and then the test of the daily support at 7588 which missed yesterday. It doesn't feel like it will get that low today though!
Above the 7734 resistance level then 7766 is next up and we should probably see that today. It is of course USA CPI news out at 1230 which has been eagerly awaited. Forecast is for a slight drop in inflation to 3.7% for February.
That higher resistance level also aligns with the R2 level for today and as such may well see the bears have a go here.
On the positive side again, the 10d Raff channel is now heading up again which bodes well for the seasonality to play out with the bullish March.
Above 7766 then 7800 round number and ultimately R3 at 7827 comes into play, though feels like a big ask unless the inflation data really drives a strong rally.
Looking at the Dax40 and the S&P500 both look like they will also get a dip and rise today, to at least attempt a bear Tuesday to start off with. Key supports at 17760 and 5119 respectively and it will be good to see these hold to tee up a bounce on both.
Good luck today.
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Looking at the Dax40 and the S&P500 both look like they will also get a dip and rise today, to at least attempt a bear Tuesday to start off with. Key supports at 17760 and 5119 respectively and it will be good to see these hold to tee up a bounce on both.