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Bear markets | Sharply rising interest rates | FOMC | 7280 7350 resistance |7200 7175 support

#1 · 14th June 2022, 9:31 am

Quote from Nick on 14th June 2022, 9:31 am
FTSE 100 Analysis | Signals | Forecast | Prediction | FTSE 100 Outlook | Trading help
Wall Street collapsed into a bear market on Monday amid fears that sharply rising interest rates will tip the world's biggest economy into a recession. The benchmark S&P 500 index was trading 21.8pc below its January peak after it sank into the red once more following its worst week in five months.
Tech stocks bore the brunt of heavy selling, with the Nasdaq index falling 4.6pc. Separately, crypto assets endured another huge sell-off with Bitcoin down 12pc.
The FTSE 250 has fallen to its lowest level in three months after Britain's GDP unexpectedly shrank in April ahead of a Bank of England policy meeting this week. The domestically-focussed index plunged 2.6%, while the FTSE 100 lost 1.5%. Both recorded a fifth straight session of losses.
Investors have ploughed their money into safe assets such as the dollar, which is rising on expectations of monetary tightening by the Federal Reserve.
The US currency climbed again on Monday, reaching its best four-day gain since the onset of the pandemic.
The Fed is expected to deliver a 0.5 percentage point interest rate increase at its meeting on Wednesday as officials try to curb rampant inflation. The Bank of England is expected to raise interest rates again on Thursday by 25 basis points to 1.25pc. If it opts for a bigger hike, it could stoke recession fears.
US markets expect rates to have increased by 1.75 percentage points by September.
Markets were stunned last week after US inflation for the year to May came in at 8.6pc, marking a rise against April that confounded hopes that price rises were waning.
Asia Tuesday
Stocks sank deeper into a bear market Tuesday amid growing expectations of sharper Federal Reserve interest-rate hikes to fight inflation.
An Asian share index fell over 1.5%, with bourses from Japan to China and Hong Kong in the red. But US and European futures pushed higher, hinting at some stabilization in sentiment after a three-day rout in the S&P 500 of nearly 9%.
Shorter-maturity Treasuries dropped while longer tenors edged up following a rout Monday, deepening a yield curve inversion that underscores worries about an economic downturn sparked by tighter monetary policy.
Australian and New Zealand debt retreated, while the Bank of Japan boosted bond-purchase operations to keep yields in check. The yen dipped and was near a 24-year low against the dollar.
Traders now see about 200 basis points of tightening by the Fed’s September decision and the possibility of a 75 basis-point hike. They expect the overnight rate to peak at 4% by mid-2023. The dollar hovered near a two-year high.
Speculative investments have suffered in the risk-asset selloff. Bitcoin slid as much as 10% to around $21,000 before paring a chunk of the retreat.
FTSE 100 live outlook prediction analysis for 14th June 2022
Well that was a rather red day yesterday as markets dropped the ball considerably on all sorts of fears. With a bear market now "official" we will probably get a rally today, and the S&P needs to pop through 3800 to start with today. Initial resistance on the FTSE100 is at the 2h Hull MA at 7260 so we will see if we get a reaction here to start the day, but I am thinking that we will see bit of a relief rally/bear market bounce today, at least to start with.
The FTSE100 is still pretty resilient really, holding above the 7170 level yesterday and back above 7250 as I write this.
If we do get a dip to start with then I am looking at the 7200 area as support, with 7175 below this. I have put the long order for the mid point here in case it overshoots one and doesn't reach the other. The 30m coral has now gone green and the short time frames across the board are bullish to start with. The longer timeframes (2h and above), as you would expect are bearish.
Above 7260 we have 7350 as the next major resistance and then R2 at 7370, along with the 30m 200ema here. We could see a rise stall here if it got that high.
R1 is at 7300 and just above the key fib at 7280 so also worth keeping an eye on that area.
The bears will be looking to take it down to 7200 as mentioned, and a break of 7175 will get things looking a bit grim again, as that opens up a test of the 7100 level where we have S2 for today.
S&P500
As mentioned 3800 is initial resistance with 3850 above that. The bulls will be looking to take it up towards that today, and should we get a drop down to the 3750 level then that level looks good for a bounce. Below 3750 then 3713 S1 would likely be seen.
Likely to be another tricky day so stay nimble and good luck!
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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.
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FTSE 100 Analysis | Signals | Forecast | Prediction | FTSE 100 Outlook | Trading help

Wall Street collapsed into a bear market on Monday amid fears that sharply rising interest rates will tip the world's biggest economy into a recession. The benchmark S&P 500 index was trading 21.8pc below its January peak after it sank into the red once more following its worst week in five months.

Tech stocks bore the brunt of heavy selling, with the Nasdaq index falling 4.6pc. Separately, crypto assets endured another huge sell-off with Bitcoin down 12pc.

The FTSE 250 has fallen to its lowest level in three months after Britain's GDP unexpectedly shrank in April ahead of a Bank of England policy meeting this week. The domestically-focussed index plunged 2.6%, while the FTSE 100 lost 1.5%. Both recorded a fifth straight session of losses.

Investors have ploughed their money into safe assets such as the dollar, which is rising on expectations of monetary tightening by the Federal Reserve.

The US currency climbed again on Monday, reaching its best four-day gain since the onset of the pandemic.

The Fed is expected to deliver a 0.5 percentage point interest rate increase at its meeting on Wednesday as officials try to curb rampant inflation. The Bank of England is expected to raise interest rates again on Thursday by 25 basis points to 1.25pc. If it opts for a bigger hike, it could stoke recession fears.

US markets expect rates to have increased by 1.75 percentage points by September.

Markets were stunned last week after US inflation for the year to May came in at 8.6pc, marking a rise against April that confounded hopes that price rises were waning.

Asia Tuesday
Stocks sank deeper into a bear market Tuesday amid growing expectations of sharper Federal Reserve interest-rate hikes to fight inflation.

An Asian share index fell over 1.5%, with bourses from Japan to China and Hong Kong in the red. But US and European futures pushed higher, hinting at some stabilization in sentiment after a three-day rout in the S&P 500 of nearly 9%.

Shorter-maturity Treasuries dropped while longer tenors edged up following a rout Monday, deepening a yield curve inversion that underscores worries about an economic downturn sparked by tighter monetary policy.

Australian and New Zealand debt retreated, while the Bank of Japan boosted bond-purchase operations to keep yields in check. The yen dipped and was near a 24-year low against the dollar.

Traders now see about 200 basis points of tightening by the Fed’s September decision and the possibility of a 75 basis-point hike. They expect the overnight rate to peak at 4% by mid-2023. The dollar hovered near a two-year high.

Speculative investments have suffered in the risk-asset selloff. Bitcoin slid as much as 10% to around $21,000 before paring a chunk of the retreat.

FTSE 100 live outlook prediction analysis for 14th June 2022

Well that was a rather red day yesterday as markets dropped the ball considerably on all sorts of fears. With a bear market now "official" we will probably get a rally today, and the S&P needs to pop through 3800 to start with today. Initial resistance on the FTSE100 is at the 2h Hull MA at 7260 so we will see if we get a reaction here to start the day, but I am thinking that we will see bit of a relief rally/bear market bounce today, at least to start with.

The FTSE100 is still pretty resilient really, holding above the 7170 level yesterday and back above 7250 as I write this.

If we do get a dip to start with then I am looking at the 7200 area as support, with 7175 below this. I have put the long order for the mid point here in case it overshoots one and doesn't reach the other. The 30m coral has now gone green and the short time frames across the board are bullish to start with. The longer timeframes (2h and above), as you would expect are bearish.

Above 7260 we have 7350 as the next major resistance and then R2 at 7370, along with the 30m 200ema here. We could see a rise stall here if it got that high.

R1 is at 7300 and just above the key fib at 7280 so also worth keeping an eye on that area.

The bears will be looking to take it down to 7200 as mentioned, and a break of 7175 will get things looking a bit grim again, as that opens up a test of the 7100 level where we have S2 for today.

S&P500
As mentioned 3800 is initial resistance with 3850 above that. The bulls will be looking to take it up towards that today, and should we get a drop down to the 3750 level then that level looks good for a bounce. Below 3750 then 3713 S1 would likely be seen.

Likely to be another tricky day so stay nimble and good luck!

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 with just your email address

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