Technical analysis for FTSE 100 for 29th February 2024
The FTSE100 closed down on Wednesday as earnings updates from Reckitt and St. James's Place disappointed investors, while caution loomed ahead of key inflation figures from the U.S. and Europe this week.
St. James's Place slumped 18.6% to an 11-year low after the wealth manager swung to an annual loss, hit by a 426 million pound ($538.98 million) provision made for potential client refunds over historic ongoing servicing complaints.
More broadly, the large-cap FTSE 100 and the FTSE 250 index shed 0.8% each.
Nearly two months into 2024, against the backdrop of a slowing local economy, the more domestically exposed mid-cap index has starkly underperformed its more internationally-focused peer, with the former down over 3% year-to-date, compared with a 0.8% decline in the FTSE 100.
In prime focus will be U.S. and European inflation data this week that could offer insights into when central banks in the developed world could start cutting interest rates.
Asia
Asian equities were mostly weaker on Thursday, while the dollar and U.S. Treasuries were largely steady ahead of crucial U.S. inflation data that could provide fresh clues on when the Federal Reserve will cut interest rates.
Chinese stocks, though, rebounded from Wednesday's sharp decline to keep them on track for their best month since November 2022.
FTSE 100 technical analysis for today, 29th February 2024
Having bounced off the 7600 level last night the bulls will be aiming for a leap year push up today and a rise and dip on profit taking later may well play out. The 2h chart has now gone bearish and has resistance at the 7650 level so this is the first hurdle for the bulls, for a possible test of the 7715 level today.
It looks like we may well see a rise and dip on the US markets today as well. The S&P500 2hr chart is bearish and has decent resistance from both the Hull MA and the coral at the 5090 area, so a short here is worth a go.
We have the PCE data out at 1330 in the USA as well, so we may well see a bit of movement from that around that time.
Initially we have support on the FTSE100 at the 7630 level with the daily pivot and bullish moving averages on the 30m chart. 7616 is also the 30m coral, and whilst still red as I write this, moving above it bodes well for it turning to green support shortly. A break of that will likely lead to the out of hours low at the 7595 level and then lower down we still have that daily support at 7575. I don't think we will get that low today but do bear it in mind.
Resistance wise, 7662 is also in play above the 7650 where we have the 30m 200ema and then 7670 for R1. 7680 is also the key fib to lend a bit of weight to this area so an initial stutter in this area may well make sense.
A move above the 7680 level will likely lead to the 7700 round number, and then a test of that 7714 daily resistance above that. Feels like it might be a big ask to get that high but again, it's a level to bear in mind, especially if we do get the rise and dip play out.
The end of month Dax40 trade is probably worth taking as well today - buy at 3pm and 9pm and hold till tomorrow morning. We will probably chat about this in the trade room today.
Good luck today.
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