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Inflation rises again | Rates increase | 7522 7490 support | 7595 7622 resistance

#1 · 21st June 2023, 9:13 am

Quote from Nick on 21st June 2023, 9:13 am
FTSE100 Analysis | Signals | Forecast | Prediction | FTSE 100 Outlook | Trading help
FTSE100 analysis & prediction for 21st June 2023
The FTSE 100 finished lower and the pound lost ground amid concerns over the UK’s mortgage market mount. The blue-chip index was pulled down with banks and mining stocks among the biggest fallers. The FTSE 100 finished 19.17 points or 0.25pc lower, closing at 7,569.31.
Asian stocks struggled on Wednesday as a lack of new stimulus steps from Beijing frustrated investors, who were also wondering just how hawkish the world's most powerful central banker would be later in the session.
Federal Reserve Chair Jerome Powell faces lawmakers in two days of testimony and is sure to be questioned on whether rates will really rise again in July and peak in a 5.5%-5.75% range as projected.
Some nice trades yesterday even if I do say so myself, as the late June weakness plays out. We have just had the UK inflation news out, showing a rise in core inflation to 7.1%, its highest level in 30 years. More rate hikes on the way for sure now, and as mentioned yesterday I still think they will be at 5.5% before too long. 6% isn't off the table either! Mortgage rate shocks will really start to bite next year as the various Covid driven asset bubbles start to pop in earnest.
Initially today we could see a kick up to test the 2h resistance area at the 7595 level before more downside towards the 7522 S2 level. There is an outside chance that we drop down to S3 and the bottom of the 10d Raff channel at the 7485 area, and if we were to do so we could see bounce here. 7523 is also the key fib for today so do keep an eye on that.
The usual pattern of late has been a weak start to the week with bulls returning on Thursday and Friday. We may well see that again, though don't forget the bit from yesterdays email and the traditionally weak end of June. Should set up a decent bullish July though!
Above 7595 then the bulls will likely manage 7622 where we have the key fib, and the 7628 for R2. Feels like a big ask initially though, after that inflation news. But..... the S&P500 has defended the 4380 support level overnight and if that puts in a rise towards the 4415 resistance level then it may well help pull the FTSE100 up with it. 4420 is the red 2h coral, along with 4415 for the Hull MA and the key fib, so the bulls might have a challenge breaking this zone.
A rise and dip would play out pretty well today, and that 7595 level does look good for resistance today. A lot will depend on the S&P500 though and we also have Powell's testimony at 15:00. Tomorrows BoE rate increase to 4.75% looking all but confirmed now too.
Not too much more to say really. Have a great trading session today and good luck.
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FTSE100 Analysis | Signals | Forecast | Prediction | FTSE 100 Outlook | Trading help

FTSE100 analysis & prediction for 21st June 2023

The FTSE 100 finished lower and the pound lost ground amid concerns over the UK’s mortgage market mount. The blue-chip index was pulled down with banks and mining stocks among the biggest fallers. The FTSE 100 finished 19.17 points or 0.25pc lower, closing at 7,569.31.

Asian stocks struggled on Wednesday as a lack of new stimulus steps from Beijing frustrated investors, who were also wondering just how hawkish the world's most powerful central banker would be later in the session.

Federal Reserve Chair Jerome Powell faces lawmakers in two days of testimony and is sure to be questioned on whether rates will really rise again in July and peak in a 5.5%-5.75% range as projected.

Some nice trades yesterday even if I do say so myself, as the late June weakness plays out. We have just had the UK inflation news out, showing a rise in core inflation to 7.1%, its highest level in 30 years. More rate hikes on the way for sure now, and as mentioned yesterday I still think they will be at 5.5% before too long. 6% isn't off the table either! Mortgage rate shocks will really start to bite next year as the various Covid driven asset bubbles start to pop in earnest.

Initially today we could see a kick up to test the 2h resistance area at the 7595 level before more downside towards the 7522 S2 level. There is an outside chance that we drop down to S3 and the bottom of the 10d Raff channel at the 7485 area, and if we were to do so we could see bounce here. 7523 is also the key fib for today so do keep an eye on that.

The usual pattern of late has been a weak start to the week with bulls returning on Thursday and Friday. We may well see that again, though don't forget the bit from yesterdays email and the traditionally weak end of June. Should set up a decent bullish July though!

Above 7595 then the bulls will likely manage 7622 where we have the key fib, and the 7628 for R2. Feels like a big ask initially though, after that inflation news. But..... the S&P500 has defended the 4380 support level overnight and if that puts in a rise towards the 4415 resistance level then it may well help pull the FTSE100 up with it. 4420 is the red 2h coral, along with 4415 for the Hull MA and the key fib, so the bulls might have a challenge breaking this zone.

A rise and dip would play out pretty well today, and that 7595 level does look good for resistance today. A lot will depend on the S&P500 though and we also have Powell's testimony at 15:00. Tomorrows BoE rate increase to 4.75% looking all but confirmed now too.

Not too much more to say really. Have a great trading session today and good luck.

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 FTSE100, 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 FTSE100, DAX40, Gold and S&P500.
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