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Dip and rise today with 6670 6640 support | 6741 6765 resistance | Bounce from Friday

#1 · 22nd March 2021, 12:13 pm

Quote from Nick on 22nd March 2021, 12:13 pm
FTSE 100 live outlook prediction analysis for 22nd March 2021
London’s blue-chip index had its worst session since late February on Friday, touching the lowest level in almost a fortnight to track a fall in global equities. The FTSE 100 fell 70.97 points to 6,708.71, underperforming its European counterparts and recording its first weekly decline in three weeks.

Boosting the weak sentiment was the US Federal Reserve’s decision not to extend the supplementary leverage ratio, which requires US banks to hold less capital reserves in order to free up cash to inject into the economy with loans.
The Fed “undid any goodwill it generated following Wednesday evening’s meeting” when it kept rates steady and upgraded the US economic outlook, said Connor Campbell, financial analyst at Spreadex.
Reacting on this side of the pond, traders pulled out of stocks over worries that more restrictions on capital requirements could hold back an economic recovery. A retreat in US treasury yields also weighed on banking stocks. HSBCfell 10.7p to 430.9p, Barclays dropped 1.2p to 182.6p and Lloyds edged down 0.6p to 41p.
Room to Boom
China still has room to pump more cash into the economy while keeping its debt ratio stable, People’s Bank of China Governor Yi Gang said in Beijing on Sunday. China’s total debt-to-GDP ratio remains at a stable level, Yi said at the China Development Forum. “This will not only provide positive incentives for economic players, but also help create an environment less likely to spawn financial risks.” he said. China appointed two new members to the PBOC's monetary policy committee as it shifts focuses to lowering risk: Cai Fang, a well-known economist, and Wang Yiming, a former deputy director of the Development Research Center of the State Council.
Cautious Stocks
Asian stocks look set to start the week cautiously with investors continuing to fret about rising bond yields and inflation as economic activity picks up. Futures slipped in Japan and Australia and were higher in Hong Kong earlier. The Turkish lira plunged as much as 17% in early Asian trading after President Recep Tayyip Erdogan removed the central-bank governor following a bigger-than-expected increase in interest rates. The lira’s slide is unlikely to have a sustained spill-over to Asia’s emerging currencies. The yen and the dollar advanced against G10 currencies. Oil ended its worst week since October with a gain, while a heavy slate of Treasury auctions this week focused in maturities that have taken a beating recently will keep the bond market in focus.[Bloomberg]
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US & Asia Overnight from Bloomberg
sian stocks fluctuated and Nasdaq 100 futures climbed as investors responded to a pullback in Treasury yields at the start of the week. Turkey’s lira tumbled after the President ousted the central bank governor.
S&P 500 futures swung between red and green, and MSCI Inc.’s Asia Pacific gauge pared losses. Shares rose in China and Australia, while Japan underperformed.
The Turkish lira slumped as much as 15% in Asian trade after President Recep Tayyip Erdogan removed the country’s third central bank chief in less than two years, two days after a larger-than-expected rate hike. Turkey will continue to stick to free markets and a liberal foreign-exchange regime, Treasury said. The dollar advanced against most Group-of-10 currencies.
A heavy slate of Treasury auctions this week poses a potential catalyst for a renewed rise in bond yields. The 10-year benchmark subsided Monday to 1.68% from the highest levels in about 14 months. Oil steadied after its worst week since October.
Investors’ concerns that a stronger economic recovery could lead to much higher inflation are dominating equity and bond markets. Some suspect price pressures could force the Federal Reserve to tighten monetary policy sooner than its current guidance suggests. The related selloff in bonds has propelled yields higher in recent weeks and fueled a rotation out of growth into value shares.
Fed Chairman Jerome Powell reiterated in a Wall Street Journal editorial that the central bank will provide aid to the economy “for as long as it takes.” Richmond Fed President Thomas Barkin said in a Bloomberg TV interview Sunday that there is no sign yet of unwanted inflation pressures.
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
The drop off 6800 continued Friday and the bulls are on the back foot now, with the S&P failing just shy of the 4000 level (far to many on FinTwit etc calling for it probably) and dragging everything else down with it. Talk of the movement of more institutional money flowing out of the US towards Asia (and leaving Europe as well) is getting stronger as well. A Credit Suisse survey of more than 200 institutional investors with $812 billion in hedge fund assets showed Asia-Pacific was the most-sought after region with 55% net demand, the highest level of interest in over a decade. Funds predict a flow of cash from North America and Europe as investors seek to tap the early pandemic recovery in China and other parts of the region.
Anyway, for the FTSE to start with we have support at the 6690 level with better support at the 6670 area which was Fridays low, and also tallies with the key fib and S1 for today at 6669. If the bears were to break below this though (and a bearish S&P today breaking below its low on Friday at 3885 will get the bears going and further slides inevitable (and the top in at 3989)). Below 6670 and then S2 is at 6619 though we may well see a reaction at the bottom of the Raff channels, both of which are at the 6640 level. If we see this 6640 level then I think that a long here will be worth a go today.
For the bulls they will be keen for a bull Monday and to build on the bounce from Friday. Getting the price above the 6745 level will be key (and above 3937 on the S&P) both of which are the 30m 200ema levels. Ball is firmly in the bulls court now. Basically they will need to hold Fridays low today.
Initial resistance us at the daily pivot at 6713, and then the 6745 above that, with 6770 next up where have R1 and the key fib. The bulls could certainly manage 6745 initially, but 6770 might be a taller order but bear it in mind.
Feels like a buy the dip day today, and as mentioned, watch for Friday's lows to hold across the board. 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 22nd March 2021

London’s blue-chip index had its worst session since late February on Friday, touching the lowest level in almost a fortnight to track a fall in global equities. The FTSE 100 fell 70.97 points to 6,708.71, underperforming its European counterparts and recording its first weekly decline in three weeks.

Boosting the weak sentiment was the US Federal Reserve’s decision not to extend the supplementary leverage ratio, which requires US banks to hold less capital reserves in order to free up cash to inject into the economy with loans.

The Fed “undid any goodwill it generated following Wednesday evening’s meeting” when it kept rates steady and upgraded the US economic outlook, said Connor Campbell, financial analyst at Spreadex.

Reacting on this side of the pond, traders pulled out of stocks over worries that more restrictions on capital requirements could hold back an economic recovery. A retreat in US treasury yields also weighed on banking stocks. HSBCfell 10.7p to 430.9p, Barclays dropped 1.2p to 182.6p and Lloyds edged down 0.6p to 41p.

Room to Boom

China still has room to pump more cash into the economy while keeping its debt ratio stable, People’s Bank of China Governor Yi Gang said in Beijing on Sunday. China’s total debt-to-GDP ratio remains at a stable level, Yi said at the China Development Forum. “This will not only provide positive incentives for economic players, but also help create an environment less likely to spawn financial risks.” he said. China appointed two new members to the PBOC's monetary policy committee as it shifts focuses to lowering risk: Cai Fang, a well-known economist, and Wang Yiming, a former deputy director of the Development Research Center of the State Council.

Cautious Stocks

Asian stocks look set to start the week cautiously with investors continuing to fret about rising bond yields and inflation as economic activity picks up. Futures slipped in Japan and Australia and were higher in Hong Kong earlier. The Turkish lira plunged as much as 17% in early Asian trading after President Recep Tayyip Erdogan removed the central-bank governor following a bigger-than-expected increase in interest rates. The lira’s slide is unlikely to have a sustained spill-over to Asia’s emerging currencies. The yen and the dollar advanced against G10 currencies. Oil ended its worst week since October with a gain, while a heavy slate of Treasury auctions this week focused in maturities that have taken a beating recently will keep the bond market in focus.[Bloomberg]

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US & Asia Overnight from Bloomberg

sian stocks fluctuated and Nasdaq 100 futures climbed as investors responded to a pullback in Treasury yields at the start of the week. Turkey’s lira tumbled after the President ousted the central bank governor.

S&P 500 futures swung between red and green, and MSCI Inc.’s Asia Pacific gauge pared losses. Shares rose in China and Australia, while Japan underperformed.

The Turkish lira slumped as much as 15% in Asian trade after President Recep Tayyip Erdogan removed the country’s third central bank chief in less than two years, two days after a larger-than-expected rate hike. Turkey will continue to stick to free markets and a liberal foreign-exchange regime, Treasury said. The dollar advanced against most Group-of-10 currencies.

A heavy slate of Treasury auctions this week poses a potential catalyst for a renewed rise in bond yields. The 10-year benchmark subsided Monday to 1.68% from the highest levels in about 14 months. Oil steadied after its worst week since October.

Investors’ concerns that a stronger economic recovery could lead to much higher inflation are dominating equity and bond markets. Some suspect price pressures could force the Federal Reserve to tighten monetary policy sooner than its current guidance suggests. The related selloff in bonds has propelled yields higher in recent weeks and fueled a rotation out of growth into value shares.

Fed Chairman Jerome Powell reiterated in a Wall Street Journal editorial that the central bank will provide aid to the economy “for as long as it takes.” Richmond Fed President Thomas Barkin said in a Bloomberg TV interview Sunday that there is no sign yet of unwanted inflation pressures.

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

The drop off 6800 continued Friday and the bulls are on the back foot now, with the S&P failing just shy of the 4000 level (far to many on FinTwit etc calling for it probably) and dragging everything else down with it. Talk of the movement of more institutional money flowing out of the US towards Asia (and leaving Europe as well) is getting stronger as well. A Credit Suisse survey of more than 200 institutional investors with $812 billion in hedge fund assets showed Asia-Pacific was the most-sought after region with 55% net demand, the highest level of interest in over a decade. Funds predict a flow of cash from North America and Europe as investors seek to tap the early pandemic recovery in China and other parts of the region.

Anyway, for the FTSE to start with we have support at the 6690 level with better support at the 6670 area which was Fridays low, and also tallies with the key fib and S1 for today at 6669. If the bears were to break below this though (and a bearish S&P today breaking below its low on Friday at 3885 will get the bears going and further slides inevitable (and the top in at 3989)). Below 6670 and then S2 is at 6619 though we may well see a reaction at the bottom of the Raff channels, both of which are at the 6640 level. If we see this 6640 level then I think that a long here will be worth a go today.

For the bulls they will be keen for a bull Monday and to build on the bounce from Friday. Getting the price above the 6745 level will be key (and above 3937 on the S&P) both of which are the 30m 200ema levels. Ball is firmly in the bulls court now. Basically they will need to hold Fridays low today.

Initial resistance us at the daily pivot at 6713, and then the 6745 above that, with 6770 next up where have R1 and the key fib. The bulls could certainly manage 6745 initially, but 6770 might be a taller order but bear it in mind.

Feels like a buy the dip day today, and as mentioned, watch for Friday's lows to hold across the board. 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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