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Can the bulls break above 7130 today | NFP Friday with 7100 7070 support | 7150 7200 resistance

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

FTSE 100 live outlook prediction analysis for 6th August 2021

Wall Street continued higher yesterday as investors balanced solid corporate results against the threat to the economic recovery from the spread of the delta virus variant. The S&P 500 and Nasdaq 100 rose toward record highs, up 0.4pc and 0.7pc respectively by just after midday in New York.

The dollar was weaker after data showed initial jobless claims declined in line with expectations last week.

The FTSE 100 spent the whole day doing not a lot yesterday and we may well see something similar today. The S&P still appears to be basing and the potential for a push up is still evident. If it does so then that should help pull the FTSE up towards the 7200 area.

Initially though we could well see a drop down to the 7100 support level where we have the 200ema on the 30m and also just above S1 at 7097. It would be good if the bulls hold this as then then sets up a rise towards the 7145 daily resistance level and just above the 7133 R1 and yesterday high level. Above this R2 is close at 7150 but we could see a further push towards 7170 R3 to end the week strongly.

For the bears they will be looking to break 7100 as that then opens up a test of the 25ema on the daily at 7064 and should we get that low then a long here remains viable. I haven't put it in the trade plan as I don't think we will get that low today but do bear it in mind. A break of that though and then the bulls start to lose the battle. 7060 is also S3 for today so fairly significant. Should it break then the 7000 level comes back into play, though we have the bottom of the 10 day Raff channel first at 7030.

The 2 hour chart remains bearish and we got the drop off the Hull moving average yesterday albeit within a small range and not too much bearish action. The joys of August trading!

So generally it still looks positive for further upside over the next few sessions and buying the dips remains the preferred play.

Have a great weekend and good luck today.

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Asian Session

Most Asian stocks dipped Friday as traders weighed the spread of the delta coronavirus strain against a record Wall Street close while awaiting key U.S. payrolls data. A gauge of the dollar climbed.

Shares fell in China, where Beijing’s regulatory crackdown and a warning about a possible downward spiral at China Evergrande Group -- the world’s most indebted developer -- subdued sentiment. Japan fluctuated, with Nintendo Co. weighing after a profit miss. U.S. contracts were little changed in the wake of fresh peaks for the S&P 500 and Nasdaq 100 on solid earnings.

An overnight release showing a second weekly drop in U.S. jobless claims stoked some expectations for a strong payrolls report Friday that could spark market swings. Treasuries retreated.

Crude oil headed for its biggest weekly loss this year on demand risks from Covid-19. Australia’s dollar was the weakest performer among Group of 10 currencies after the nation’s central bank governor Philip Lowe said a lower exchange rate from monetary stimulus was welcome.

Trader focus is firmly on the U.S. payrolls report. Weak data could exacerbate concerns that the bounce back from the pandemic is losing steam. A robust number stands to benefit reflation trades linked to economic reopening -- providing markets aren’t spooked by the argument that such data strengthen the case for the Federal Reserve to taper massive stimulus support. [Bloomberg]

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