Quote from Nick on 21st July 2020, 9:58 am

FTSE 100 live outlook prediction analysis for 21st July 2020

The FTSE 100 dropped yesterday, lagging its European peers, with consistent gains for pharma giant AstraZeneca unable to offset a broader slide among London’s blue-chips.  The mood on the FTSE 100 was nervous: energy heavyweights Royal Dutch Shell and BP both lost ground, while lender HSBC slipped amid rising tensions between the US and China over the situation in Hong Kong and alleged human rights abuses. However the FTSE 250 pushed 0.25pc while Frankfurt's DAX and Paris' CAC also finished the session up.

Here's a quick summary of Monday's events:

• Eurozone stock markets pushed higher as EU leaders laboured to pin down a €750bn coronavirus rescue package for the battered region.
• The euro hit a four-month dollar peak of $1.1468, before paring its gains.
• Frankfurt equities rose 1pc and Paris added 0.5pc, outside the eurozone, London lost 0.5pc.
• Wall Street was mixed as investors awaited congressional debate on another round of stimulus spending and major earnings releases later in the week.
• Oil prices slid lower as Chevron said it had agreed to buy US exploration and production company Noble Energy for $5bn, the biggest petroleum acquisition since the industry downturn caused by the coronavirus.

A coronavirus vaccine

A coronavirus vaccine that the University of Oxford is developing with AstraZeneca is showing promising results in early human testing, and is now set to move into larger tests. That may sound like cause for good news, but the results still weren’t enough to convince the market. AstraZeneca fell from a record high in New York trading on concerns over whether its vaccine can match the progress seen in programs from Pfizer and BioNtech SE, as well as Moderna. “In the competitive context they fail to impress,” said Bernstein analysts led by Ronny Gal. The vaccine increased levels of both protective neutralizing antibodies and immune T-cells that target the virus, according to the study organizers. The results, published Monday in The Lancet medical journal, are a key milestone for one of the fastest-moving vaccine projects globally. “Our hope is that we can actually start delivering a vaccine before the end of the year,” Chief Executive Officer Pascal Soriot said on a call.

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

Asian stocks rose Tuesday after U.S. shares rallied to the highest since February, with progress on European stimulus and coronavirus vaccines also boosting sentiment. The dollar held losses. Shares were up more than 1% in Australia, South Korea and Hong Kong. Japan and China were little changed. European futures gained after European Union leaders reached a deal on a landmark stimulus package. Treasuries and oil were steady. S&P 500 contracts fluctuated after the benchmark turned positive for the year.

It's looking promising at these early stages on the vaccine front and despite the market not being overly bullish yesterday as it has on previous vaccine news, we have seen a slow steady rise instead. Overnight has held up well, with it hovering around the 6300 areaThe bulls defended the 6225 level again, and as I am writing this we are just popping through the 6265 level. Above the cam break out level of 6303 we should manage to get to 6363 as the next main area of resistance, and that may well tally with more upside on the S&P with resistance on that at 3303 next up. If it can break through R1 at 3274 initially.

For the FTSE I am thinking that we may well get an initial dip down to test the daily pivot and the 30min green coral at the 6265 level whereupon a long is worth taking for a push up towards 6310, and more likely that 6363 resistance level. If the bulls really go for it this week then we should see the top of the Raff channels again soon, with the 20 day at 6450 currently, and the 10 day at 6480. Keep an eye on these levels.

If the bears break below the 6225 level though then a slide down to 6175 (green daily coral) and then 6070ish where we have the bottom of the 10 day Raff channel (but rising).

So not too much more to say really, looking to buy the pullbacks this morning for a rise to that 6363 level, possibly 6400 (R3) and then start thinking about more bearishness up at 6450/6480. Not sure it will get that high today unless there is some really positive news. Earnings so far haven't been too bad, with IBM's yesterday surpassing guidance. US weekly jobs claims data is out on Thursday and will be closely watched to see how the jobs market is fairing despite the uptick in US C-19 cases. Talking of C-19, Hong Kong is facing its worst outbreak currently, with a spike in cases.

Despite thoughts of a bear Tuesday it looks positive for more upside today, and if we follow the ASX200's lead then possibly just a trending up day towards that 6363 and maybe higher. Good luck today and hopefully a nice dip to start with.

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