Quote from Nick on 16th March 2021, 3:54 pm

FTSE 100 live outlook prediction analysis for 16th March 2021

The economy will rebound faster than expected to return to its pre-Covid size by the end of the year, according to the governor of the Bank of England. Andrew Bailey said the success of the vaccination programme had given him reason to be more optimistic.

China’s economy powered ahead in the first two months of the year with activity rising faster than expected in the manufacturing and services sectors, official figures show. Industrial output rose by 35.1 per cent in January and February compared with last year, stronger than the 30 per cent increase pencilled in by economists.

Stronger Stocks

Asian stocks were set to open stronger Tuesday as optimism about the economic recovery drove U.S. shares to a record-high close. Long-term Treasury yields edged lower. Futures pointed higher in Japan, Australia and Hong Kong.  The S&P 500 Index gained for a fifth-straight trading session, led by the utilities and real estate sectors, while Apple, Tesla and Facebook led the tech-heavy Nasdaq 100 higher. Oil slipped, the dollar ticked higher and Bitcoin eased back from a weekend rally that propelled the cryptocurrency above $61,000.

Vaccine Halts

Europe’s biggest countries, including Germany and France, suspended use of AstraZeneca Covid-19 vaccine amid growing concerns about possible side effects from the first two batches. Italy, Spain, the Netherlands, Ireland and Portugal have also suspended use of the shot. The move is a U-turn for some countries that had previously said inoculations should continue while the issue was investigated. U.K. Prime Minister Boris Johnson has defended the vaccine and the European Medicines Agency said its benefits continue to outweigh the risks. Meanwhile, Biden's administration is stockpiling the shot, which is not yet approved in the U.S.[Bloomberg]

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US & Asia Overnight from Bloomberg

Asian stocks rose Tuesday after optimism about the economic recovery drove U.S. shares to a record. Treasury yields held declines as traders await the Federal Reserve policy decision for clues about the outlook.

MSCI Inc.’s Asia-Pacific gauge climbed amid modest gains in Japan and China, where investors are watching for a possible broader crackdown on the internet sector. The S&P 500 advanced for a fifth session, led by utilities and real estate. Apple Inc. and Tesla Inc. helped push up the Nasdaq 100. S&P 500 contracts fluctuated, while Nasdaq 100 and European futures pointed higher.

Australian 10-year bond yields dropped, following the pullback in benchmark U.S. rates from last week’s highs. Oil slipped and the dollar was steady. Bitcoin briefly slid below $54,000 from a weekend peak above $61,000.

The market focus is turning to the Fed’s statement Wednesday, which will include fresh economic and interest-rate projections. Reflation trades stand to benefit if the central bank maintains a hands-off approach to the recent rise in yields. Bets on a faster economic recovery have already helped push one market gauge of inflation to its highest level since 2008, and a renewed climb in yields could spur the rotation from growth to value stocks.

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

The bears managed to break the 6760 support yesterday to test the lower one at 6725 which held well and we saw a decent bounce, which the bulls have defended overnight, as the S&P pushes for the 4000 level. As such we may well see the FTSE retest the recent high at 6810 today and I think that we may well get a reaction here, at least on the first touch. A rise and dip back down would play out quite well this morning.

The 2 hour chart is bearish but the bulls are hanging on still, but I wouldn't be surprised to see a bit more bearishness today. On the longer timeframe the daily chart remains bullish, and has support down at 6673. A bear Tuesday could well been the cards.

Above the 6810 level we have R2 at 6854 and that sort of area could well tally with the S&P managing to reach the 4000 level. Talking of the S&P there is initial resistance at 3980 where we have R1 and the key fib and as such we may well see a reaction here as the bears have a go.

Above the 6855 level and the bulls will be aiming for the 6900 round number and also R3 for today. The top of both the Raff channels are at the 6920 level but I am not expecting us to get that high today though.

For support, we have the daily pivot initially at the 6767 level and then the 30m 200ema at 6747. Lower down, we have a double bottom with 6723 with yesterday, and also S1 and the fib level at 6714. As such, should the bears manage to get it this low then we may well see another bounce here.

Good luck today, markets appear to be consolidating a bit, possibly before another leg up. We do have the BoE rate decision on Thursday - probably no changes though. US markets have their eye on Powell tomorrow.

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