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FTSE100 live outlook prediction analysis for 18th October 2022
A decent bull Monday yesterday that may roll into a bit more optimism for today as well. Overnight we have risen to just shy of the 7000 level and I am still advocating buy the dips for the moment. Will the seasonality play out with the usual bullish period starting about now till the year end? Santa rally stand by!
Initially we may see a bit of a dip down towards the daily pivot at the 6910 level, the main reason being that we are just testing the top of the 10d Raff channel as I write this at the 6990 level, but I am expecting dips today to hold. The market should be buoyed by the Governments U-turn after the mini budget as they blamed that for the recent drops. It therefore follows that undoing all that would lead to a rise. But then again, the markets are funny things and we were due to drop early to mid October anyway, irrespective of a mini budget!
Sterling has also been heading for parity for years and the mini budget just gave it that final little push to get the headlines!
Initial resistance is also from R1 at the 6988 level with R2 at 7039 above that looking like it may well get tested today. That would tie in with a rise on the S&P500 to the 3774 level which also looks likely. At that point then we may well see the bears have another go, on both the FTSE100 and the S&P500.
Support wise, the 30m coral is now green and has support at the 6930 level, and then the 200ema at 6901 – so there are a cluster of supports in this area and if we do get a drop down to these then I would like to see them hold.
Looking at the S&P the bulls will want to defend any drop down to the 3680 area as we have the green 30m coral there for that. Below that then the 2h Hull MA support is at the 3650 level and a level that would more than likely see a bounce if it got that low. The top of the 20d Raff channel is also at the 3775 level, which is another reason that I think we could see some profit taking here. Generally though dips will likely be shallow now and get bought up. Get your bullish mindset into gear for the rest of the month!
Good luck today!
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