Quote from Nick on 4th August 2020, 10:02 am

FTSE 100 live outlook prediction analysis for 4th August 2020

Well we got the dip and rise yesterday, just a bit lower than the 5880 though with a retest of Fridays low at 5858 before a decent climb back to 6040. 6057 remains as the main daily resistance level still, with 6136 above that.

Here's a quick summary:

• Stock markets rose on both sides of the Atlantic today as hopeful economic data prompted bargain hunting.
• Some of Asia's equities markets also made solid gains.
• On Wall Street, the Dow extended opening gains to trade about 250 points higher in the late New York morning as big tech posted gains, with both Microsoft and Apple stock more than 3pc higher.
• Key European indices were up by around 2pc or more at the close after manufacturing sector surveys in the region pointed to a return to growth.
• Earlier, Japan's Nikkei 225 had received a boost from data showing the economy contracted less than first thought in January-March.
• Shanghai also surged following a forecast-beating reading on factory activity from Caixin, days after an official report pointed to a much improved manufacturing sector.

European stock markets closed firmly higher today despite fears of a second wave of Covid-19 infections. The FTSE 100 climbed 2.29pc to 6,032.85 while the FTSE 250 jumped 1.33pc 17,158.12

Markets Rise

Asian stocks looked poised for gains Tuesday after a technology-fueled rally in the U.S. amid positive economic data and the potential for further stimulus. The dollar climbed, and futures pointed higher in Japan, Australia and Hong Kong. The Nasdaq 100 reached a record as traders sought out companies poised to do best in a stay-at-home economy. Apple set an all-time high and Microsoft gained. The dollar rebounded following its worst July in a decade and Treasuries fell across the curve as data showed U.S. manufacturing expanded in July at the fastest pace since March 2019. Elsewhere, oil rose the most in nearly two weeks. Gold was little changed. [Bloomberg]

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

Asian stocks advanced Tuesday, on track for their biggest gain in two weeks, after a technology-fueled rally in the U.S. amid positive economic data and the potential for further stimulus. The dollar held gains. Japan, Australia and South Korea outperformed. S&P 500 futures were little changed. Earlier, the Nasdaq 100 reached a record as traders sought out companies poised to do best in a stay-at-home economy.

The dollar held gains after rebounding following its worst July in a decade, and Treasuries maintained losses after data showed U.S. manufacturing expanded in July at the fastest pace since March 2019.

We certainly got the bull Monday as expected. The bulls have now brought the 6057 resistance back into play initially, and in fact we may well be on for a test finally of the 25ema on the daily which is at 6135 for today, since we got the bearish cross on 24th July. We may well see a rise and dip pay out today, especially as the S&P stalled around the 3300 level yesterday, failing to push on to the 3310 level. If it does get there then we may well see the bears appear here, which may well pull the FTSE down with it. Struggling at 3300 for the moment though. Dollar weakness helped the FTSE yesterday too, with cable now around the 13000 level, off its Friday high around the 131 level.

If the bulls break through the initial resistance level of 6058 then we should see a fairly quick test of R1 at 6090 and we are then getting near to the top of the 10 day Raff channel at 6115 for today. This is also just below that 25ema on the daily mentioned above at 6135. Ergo I am thinking that we may well see a stutter around this area (coinciding with the 3310 SPX level?) and a bit of a pull back from around here. If the bulls were to break above 6135 though then the picture changes again, and we are back looking at a test of the 20 day channel top at the 6300 level. In all honesty I can still see a rise across the board with the stimulus helping to underpin the markets (calamitous second wave not withstanding) and a dip down from this 6135 level then another big climb towards year end could actually all fit quite well.

If the bears break below 5995 today then 5943 is the 2 hour support level and the next area that I would look to go long on. Will we get a bear Tuesday though as we certainly got a bull Monday!? The bears may start today but if the bulls defend today then we may see the selling start tomorrow instead. Below 5940 then 5906 is S1 for today and then we are back looking at the 5858 level and the bottom of the Raff channels at 5800 to 5830. Don't fall in love with the upside as they say as this bounce could quite quickly run out of steam.

So, possible rise and dip to play out today, and watching that 6057 and 6135 resistance levels. 6000 then 5940 for support. Good luck today.

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