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FTSE rockets but for how long | Biden confirmed | 6940 7033 resistance | 6836 6771 support

#1 · 7th January 2021, 10:36 am

Quote from Nick on 7th January 2021, 10:36 am
FTSE 100 live outlook prediction analysis for 7th January 2021
The FTSE 100 soared on Wednesday, sealing its best ever start to a year with a 5.9pc three-day surge. Investors piled into London’s blue chips, which gained around £64bn in value on its best day since early November amid a 3.6pc daily rise powered by banks, oil companies and miners.

It marked the third day of strong outperformance for the index, which left the rest of Europe in its dust despite respectable climbs for many of its continental rivals. Over in Wall Street the tech-heavy Nasdaq lost a 0.6pc amid expectations that Democrats will use their legislative control to push through measures aimed at curbing the power of Big Tech. The S&P 500 rose 0.6pc, just shy of a record high after it pared earlier gains.
The risk-on shift across global markets knocked bond prices, pushing the yield on US 10-year Treasury bonds – one of the keystone instruments of the global financial system – above 1pc for the first time since March. The FTSE’s rise so far this week surpasses the previous record of 4.6pc in the opening days of 2009.
Sharing in the bonanza – which left only a handful of blue-chip companies in the red – listed miners continued to extend their gains as hopes of a recovery in global production pushed commodity prices higher. Stocks were boosted further by weakness in the pound, which dipped slightly against the dollar amid concerns about the Government’s Brexit deal and the UK’s struggle to control the Covid-19 pandemic. Sterling is the worst performer among the G-10 group of major currencies so far this year. The FTSE 250 also slightly underperformed despite a solid rise, in a sign that neglected UK stocks may not have completely regained favour yet.
D.C. in Disarray
President Donald Trump ordered National Guard troops to the U.S. Capitol and told supporters who overwhelmed Capitol Police and stormed the halls of Congress, forcing debate on Joe Biden’s victory in the Electoral College to be suspended, to "go home." Lawmakers fled when an angry mob stormed the Capitol building, after Trump declared in a speech that he will never concede defeat. One woman died after being shot, Capitol Police said. Earlier, Democrats took control of the U.S. Senate for the first time in six years.[Bloomberg]
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US & Asia Overnight from Bloomberg
Asian stocks advanced with U.S. futures amid expectations that President-elect Joe Biden has a clearer path to boosting fiscal stimulus after key elections. Treasuries held losses on concern about a rising debt burden and the risk of faster inflation.
A gauge of Asia-Pacific shares was on track for another record Thursday, while S&P 500 and Nasdaq 100 futures also climbed. The Democrats’ victory in two key Georgia runoffs gives them control of the U.S. Senate and has reignited the so-called reflation trade that bets on a global recovery from the pandemic.
Earlier, the S&P 500 trimmed an advance of as much as 1.5% but still closed in the green, after protesters stormed the U.S. Capitol. Calm was later restored. Elsewhere, the dollar ticked higher. Oil edged up and gold was little changed.
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
Quite the start to the year for the FTSE100 and yesterday was even more bullish than I was expecting, and at this rate we should be seeing 7000 before too long. A combination of factors are boosting the FTSE 100, the main one of course being the Brexit deal, along with the fact that the FTSE 100 has lagged its peers for a long time now and offers the best value for the time being. The S&P also managed to push on after its initial wobble down to 3695, and also looks like it will achieve further upside, despite the chaos in DC currently.
Initially on the FTSE 100 we have resistance at the R1 level of 6940 but also had a cheeky overnight spike up to 6957 so we may well see this area stop the bulls to start with. With the FTSE already up 50 points and above the key fib resistance level at 6836 we may see a drop back to here and this hold as support. I am thinking that if the bulls manage to exceed that overnight high then we may well see 7000 today to generate some pretty positive headlines in the MSM following the Brexit deal. 7033 is R2 as well so an overshoot of 7000 could reach that.
For the bears, they will be looking to break that 6836 level as then we could get a test of the daily pivot at 6771. Seems miles away when we are looking at the opening around the 6908 level where it is as I write this though! Below the pivot then we have the key fib at 6703 and then S1 and the 200ema at 6672 - an area that may well see a bounce in due course but I am not expecting that low today. 6836 remains the decent support level initially.
The S&P looks set to be on for a test of R1 today at 3796 and that should help feed the bullish sentiment on the FTSE as well. 3720 area is key support that the bulls will need to defend.
Bit too early shorting gold yesterday at 1951 as it topped at 1959 before dropping to 1900. Having held that level and climbed again, that might have reset enough for a push up towards the $2000 level.
Stay nimble again, and good luck today.
Recommended Broker

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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.
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
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FTSE 100 live outlook prediction analysis for 7th January 2021

The FTSE 100 soared on Wednesday, sealing its best ever start to a year with a 5.9pc three-day surge. Investors piled into London’s blue chips, which gained around £64bn in value on its best day since early November amid a 3.6pc daily rise powered by banks, oil companies and miners.

It marked the third day of strong outperformance for the index, which left the rest of Europe in its dust despite respectable climbs for many of its continental rivals. Over in Wall Street the tech-heavy Nasdaq lost a 0.6pc amid expectations that Democrats will use their legislative control to push through measures aimed at curbing the power of Big Tech. The S&P 500 rose 0.6pc, just shy of a record high after it pared earlier gains.

The risk-on shift across global markets knocked bond prices, pushing the yield on US 10-year Treasury bonds – one of the keystone instruments of the global financial system – above 1pc for the first time since March. The FTSE’s rise so far this week surpasses the previous record of 4.6pc in the opening days of 2009.

Sharing in the bonanza – which left only a handful of blue-chip companies in the red – listed miners continued to extend their gains as hopes of a recovery in global production pushed commodity prices higher. Stocks were boosted further by weakness in the pound, which dipped slightly against the dollar amid concerns about the Government’s Brexit deal and the UK’s struggle to control the Covid-19 pandemic. Sterling is the worst performer among the G-10 group of major currencies so far this year. The FTSE 250 also slightly underperformed despite a solid rise, in a sign that neglected UK stocks may not have completely regained favour yet.

D.C. in Disarray
President Donald Trump ordered National Guard troops to the U.S. Capitol and told supporters who overwhelmed Capitol Police and stormed the halls of Congress, forcing debate on Joe Biden’s victory in the Electoral College to be suspended, to "go home." Lawmakers fled when an angry mob stormed the Capitol building, after Trump declared in a speech that he will never concede defeat. One woman died after being shot, Capitol Police said. Earlier, Democrats took control of the U.S. Senate for the first time in six years.[Bloomberg]

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US & Asia Overnight from Bloomberg

Asian stocks advanced with U.S. futures amid expectations that President-elect Joe Biden has a clearer path to boosting fiscal stimulus after key elections. Treasuries held losses on concern about a rising debt burden and the risk of faster inflation.

A gauge of Asia-Pacific shares was on track for another record Thursday, while S&P 500 and Nasdaq 100 futures also climbed. The Democrats’ victory in two key Georgia runoffs gives them control of the U.S. Senate and has reignited the so-called reflation trade that bets on a global recovery from the pandemic.

Earlier, the S&P 500 trimmed an advance of as much as 1.5% but still closed in the green, after protesters stormed the U.S. Capitol. Calm was later restored. Elsewhere, the dollar ticked higher. Oil edged up and gold was little changed.

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

Quite the start to the year for the FTSE100 and yesterday was even more bullish than I was expecting, and at this rate we should be seeing 7000 before too long. A combination of factors are boosting the FTSE 100, the main one of course being the Brexit deal, along with the fact that the FTSE 100 has lagged its peers for a long time now and offers the best value for the time being. The S&P also managed to push on after its initial wobble down to 3695, and also looks like it will achieve further upside, despite the chaos in DC currently.

Initially on the FTSE 100 we have resistance at the R1 level of 6940 but also had a cheeky overnight spike up to 6957 so we may well see this area stop the bulls to start with. With the FTSE already up 50 points and above the key fib resistance level at 6836 we may see a drop back to here and this hold as support. I am thinking that if the bulls manage to exceed that overnight high then we may well see 7000 today to generate some pretty positive headlines in the MSM following the Brexit deal. 7033 is R2 as well so an overshoot of 7000 could reach that.

For the bears, they will be looking to break that 6836 level as then we could get a test of the daily pivot at 6771. Seems miles away when we are looking at the opening around the 6908 level where it is as I write this though! Below the pivot then we have the key fib at 6703 and then S1 and the 200ema at 6672 - an area that may well see a bounce in due course but I am not expecting that low today. 6836 remains the decent support level initially.

The S&P looks set to be on for a test of R1 today at 3796 and that should help feed the bullish sentiment on the FTSE as well. 3720 area is key support that the bulls will need to defend.

Bit too early shorting gold yesterday at 1951 as it topped at 1959 before dropping to 1900. Having held that level and climbed again, that might have reset enough for a push up towards the $2000 level.

Stay nimble again, and 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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