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Bull Wednesday on the cards with 6910 holding | 6888 support below | 6990 7030 7090 resistance

#1 · 12th May 2021, 9:01 am

Quote from Nick on 12th May 2021, 9:01 am
FTSE 100 live outlook prediction analysis for 12th May 2021
It was a full on bear Tuesday for London’s markets, with just one blue-chip company - London Stock Exchange - and 10 mid-cap firms ending the day in the green. British stocks joined a global sell-off to clock their worst day since late October after a sudden crumble in big US tech stocks overnight due to inflation concerns.
The benchmark fell back below the 7,000 level, losing 175.69 points by the end of the day to close at 6,947.99. The FTSE 250 shed 530.05 points to 22,167.14 - its lowest level in almost three weeks.

Investors are growing anxious about a surge in inflation that could mean central banks will withdraw their ultra-loose monetary policies earlier than forecast.
Restrictions Return
A wave of new restrictions is spreading across Asian countries trying to stamp out small Covid-19 outbreaks after months of containment. Taiwan announced limits on crowds in the first tightening of curbs since the middle of last year. Singapore is also limiting social gatherings and restricting entry of foreign workers, but the World Economic Forum is still planning to hold its annual meeting in the city-state in August. Thailand warned local cases may increase over the next few weeks, and Vietnam’s capital city banned large gatherings. Elsewhere, England reported zero deaths in its latest daily update and in the U.S., states are moving quickly to vaccinate teens with Pfizer’s Covid-19 shot before the summer.
Weak Start
Asian stocks are set for a weak open after a selloff in U.S. equities, amid ongoing concerns that faster inflation as commodities advance could pose a test for the recovery from the pandemic. Treasury yields climbed. Futures fell in Japan and Australia but earlier rose in Hong Kong. The S&P 500 dropped for a second day following a record high Friday. Dip buyers helped the tech-heavy Nasdaq 100 erase a loss of almost 2% to finish little changed. Treasury yields rose and the dollar traded near the lowest levels of this year.[Bloomberg]
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US & Asia Overnight from Bloomberg
Most Asian stocks fell Wednesday amid concern that faster inflation and the surge in commodities could test the economic recovery from the pandemic.
Taiwan’s benchmark posted a record drop of as much as 8.6%, led by steep losses in semiconductors and amid a diplomatic spat with China and further Covid-19 curbs. Stocks fluctuated in Hong Kong and slid in Japan and South Korea, putting the regional gauge on course for its lowest close since January. U.S. contracts slipped after the S&P 500 continued its drop from a record high Friday. Dip buyers helped the tech-heavy Nasdaq 100 erase a loss of almost 2% to finish little changed.
Treasury yields were steady and the dollar rose. Investors are awaiting inflation data and government debt sales in the U.S. -- events that could spark market volatility. Consumer-price inflation is set to quicken, with the year-on-year comparison amplified by the shock of Covid-19 shutdowns in 2020.
Australia’s 10-year bond yield jumped after the government unveiled a big-spending budget to spur the country’s rebounding economy. The Commonwealth Bank of Australia warned the country could lose its AAA credit rating.
Debate continues over whether price pressures will be persistent enough to force the Federal Reserve to tighten policy sooner than current guidance suggests. A chorus of Fed officials said the U.S. economy is on the road to recovery but still faces risks, and reiterated that it’s premature to discuss pulling back monetary support.
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
The sell off continued yesterday for a bear Tuesday, however we have held the daily coral line at 6900 and with the BoE later, along with the Fed saying that monetary support will continue, should set up a bit of a bounce today. It would be good to see a rise across the board to at least test the various 2 hour resistance levels - 7050ish FTSE, 15260ish Dax, 4185ish S&P - and then another wave of selling to kick in there.
Initial support is at 6901 where we have the daily coral, and S1 just below that at 6887. Should the bears continue pushing it lower today though, we will likely see a slide towards S2 at 6809. The break of 6950 as mentioned in yesterdays missive is quite bearish though and the bears will certainly be keen to push this a lot lower. It certainly didnt last long above 7000! Below S2 and then 6760 is the next main level of significance and should we get that low I expect to see it hold. The daily RSI(10) is down at 42 now, so this mini sell off has certainly helped to reset that. The "sell in May and go away" kicking in so far anyway.
For the bulls, should they defend initially today, then we should see a rise towards the daily pivot at 6990. A break of that brings those 2 hour resistance levels into play, namely the Hull moving average first at 7050ish, then the coral at 7090ish. It would also be a shot in the arm if they got it back above 7000 as that will certainly help the bulls gain some momentum again.
The S&P needs to hold the yesterday low level at 4115 for today to push up towards the 4180 area where we have the 2h resistance. A break of 4115 and then 4100 and possibly even a retest of the 4000 level beckons (not today for that though, cant see it dropping 140 points today). So for the moment watch the 4115 support level.
Feels like we might get a bounce today, dead cat or buy the dip depending on your viewpoint. Good luck today.
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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 live outlook prediction analysis for 12th May 2021

It was a full on bear Tuesday for London’s markets, with just one blue-chip company - London Stock Exchange - and 10 mid-cap firms ending the day in the green. British stocks joined a global sell-off to clock their worst day since late October after a sudden crumble in big US tech stocks overnight due to inflation concerns.

The benchmark fell back below the 7,000 level, losing 175.69 points by the end of the day to close at 6,947.99. The FTSE 250 shed 530.05 points to 22,167.14 - its lowest level in almost three weeks.

Investors are growing anxious about a surge in inflation that could mean central banks will withdraw their ultra-loose monetary policies earlier than forecast.

Restrictions Return

A wave of new restrictions is spreading across Asian countries trying to stamp out small Covid-19 outbreaks after months of containment. Taiwan announced limits on crowds in the first tightening of curbs since the middle of last year. Singapore is also limiting social gatherings and restricting entry of foreign workers, but the World Economic Forum is still planning to hold its annual meeting in the city-state in August. Thailand warned local cases may increase over the next few weeks, and Vietnam’s capital city banned large gatherings. Elsewhere, England reported zero deaths in its latest daily update and in the U.S., states are moving quickly to vaccinate teens with Pfizer’s Covid-19 shot before the summer.

Weak Start

Asian stocks are set for a weak open after a selloff in U.S. equities, amid ongoing concerns that faster inflation as commodities advance could pose a test for the recovery from the pandemic. Treasury yields climbed. Futures fell in Japan and Australia but earlier rose in Hong Kong. The S&P 500 dropped for a second day following a record high Friday. Dip buyers helped the tech-heavy Nasdaq 100 erase a loss of almost 2% to finish little changed. Treasury yields rose and the dollar traded near the lowest levels of this year.[Bloomberg]

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US & Asia Overnight from Bloomberg

Most Asian stocks fell Wednesday amid concern that faster inflation and the surge in commodities could test the economic recovery from the pandemic.

Taiwan’s benchmark posted a record drop of as much as 8.6%, led by steep losses in semiconductors and amid a diplomatic spat with China and further Covid-19 curbs. Stocks fluctuated in Hong Kong and slid in Japan and South Korea, putting the regional gauge on course for its lowest close since January. U.S. contracts slipped after the S&P 500 continued its drop from a record high Friday. Dip buyers helped the tech-heavy Nasdaq 100 erase a loss of almost 2% to finish little changed.

Treasury yields were steady and the dollar rose. Investors are awaiting inflation data and government debt sales in the U.S. -- events that could spark market volatility. Consumer-price inflation is set to quicken, with the year-on-year comparison amplified by the shock of Covid-19 shutdowns in 2020.

Australia’s 10-year bond yield jumped after the government unveiled a big-spending budget to spur the country’s rebounding economy. The Commonwealth Bank of Australia warned the country could lose its AAA credit rating.

Debate continues over whether price pressures will be persistent enough to force the Federal Reserve to tighten policy sooner than current guidance suggests. A chorus of Fed officials said the U.S. economy is on the road to recovery but still faces risks, and reiterated that it’s premature to discuss pulling back monetary support.

FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis

The sell off continued yesterday for a bear Tuesday, however we have held the daily coral line at 6900 and with the BoE later, along with the Fed saying that monetary support will continue, should set up a bit of a bounce today. It would be good to see a rise across the board to at least test the various 2 hour resistance levels - 7050ish FTSE, 15260ish Dax, 4185ish S&P - and then another wave of selling to kick in there.

Initial support is at 6901 where we have the daily coral, and S1 just below that at 6887. Should the bears continue pushing it lower today though, we will likely see a slide towards S2 at 6809. The break of 6950 as mentioned in yesterdays missive is quite bearish though and the bears will certainly be keen to push this a lot lower. It certainly didnt last long above 7000! Below S2 and then 6760 is the next main level of significance and should we get that low I expect to see it hold. The daily RSI(10) is down at 42 now, so this mini sell off has certainly helped to reset that. The "sell in May and go away" kicking in so far anyway.

For the bulls, should they defend initially today, then we should see a rise towards the daily pivot at 6990. A break of that brings those 2 hour resistance levels into play, namely the Hull moving average first at 7050ish, then the coral at 7090ish. It would also be a shot in the arm if they got it back above 7000 as that will certainly help the bulls gain some momentum again.

The S&P needs to hold the yesterday low level at 4115 for today to push up towards the 4180 area where we have the 2h resistance. A break of 4115 and then 4100 and possibly even a retest of the 4000 level beckons (not today for that though, cant see it dropping 140 points today). So for the moment watch the 4115 support level.

Feels like we might get a bounce today, dead cat or buy the dip depending on your viewpoint. 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

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