Quote from Nick on 18th December 2020, 9:58 am

FTSE 100 live outlook prediction analysis for 17th December 2020

It was a dud day for the FTSE 100 yesterday, which traded fairly flat throughout the session amid pressure from the pound, which extended its two-year high against a weak dollar.
Amazon.co.uk Widgets
New ONS stats today show businesses are still struggling amid a resurgence of Covid. Some 41pc of companies said they had less than six months' reserve cash, while 30pc of those still trading had no or low confidence that they would survive the next three months. But, there were 15,766 company incorporations in the week ending Dec 11, higher than the same week last year.

Job losses in the US shot up to a three-month high last week as new coronavirus restrictions take their toll on the labour market. The number of workers making new claims for jobless benefits climbed to 885,000, from 862,000 the previous week.

Market Highs

U.S. stocks rose to fresh records and the dollar fell as lawmakers continued to wrangle over a federal-spending deal in Washington. Asian equities looked set for a mixed start. Futures were little changed in Japan and Australia, and dipped in Hong Kong. The S&P 500 climbed for a third day. Treasury yields rose. Elsewhere, the yen held gains ahead of Friday’s Bank of Japan policy meeting. Oil climbed to the highest since February.

Hacked

The U.S. nuclear weapons agency and at least three states were hacked as part of a suspected Russian cyber-attack that struck several federal government agencies. The hack affected unclassified systems, according to a person familiar with the matter. While President Donald Trump has yet to publicly address the hack, President-elect Joe Biden issued a statement Thursday, and said he intends to make cybersecurity “a top priority”. The Cybersecurity and Infrastructure Security Agency said the hack poses a “grave risk” to federal, state and local governments as well as critical infrastructure and the private sector.[Bloomberg]

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US & Asia Overnight from Bloomberg

Most Asian stocks fell with U.S. and European futures Friday amid fresh U.S.-China tensions and as lawmakers continued to wrangle over a federal-spending deal in Washington. The dollar pushed higher.

Shares fell across much of Asia Pacific on volumes below the recent average. Sentiment took a hit after Reuters reported the U.S. is set to blacklist dozens of Chinese firms. S&P 500 futures pulled back after the index closed at a record high. A bipartisan U.S. stimulus deal “appears to be close at hand,” Senate Majority Leader Mitch McConnell said, but will probably require work over the weekend to get through Congress. Investors earlier took an unexpectedly large rise in jobless claims as a sign the two sides would be prodded toward an agreement. Treasury yields ticked lower.

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

Starting the run towards Christmas now with the last Friday trading before the break. The US made new record highs yesterday and the S&P finally pushed back above the 3705 level, though again fell just shy of the 3730 level. That said, its held well overnight and we may well get the usual Friday afternoon pump later to help end the week strongly. Bulls will be keen to defend the 3705 level.

The FTSE has been a bit of a dog recently, weighed down by Brexit and sterling, but it has managed to hold above 6500 so far in December. Can the bulls muster up some festive sprit for a final push of the year?

For today, we have initial support back in play at the 6520 level that has been fairly key recently, with S2 at 6505 just below that. 6520 has held overnight as well. S1 is slightly higher at 6529 but we have a brief foray below that overnight. If 6500 breaks though today then we will more than likely slide down to the 6482 level which was the low on Tuesday. Of interest is that we also have the bottom of the 10 day Raff channel in play at 6467 and lining up with S3 for today. If the bears go for it then we could see this level, and the bulls might well defend this. A long here is probably worth a go, as 6430 is now also the 25ema on the daily, also 20 day Raff channel bottom, and would be the first test of that key support since it turned bullish a while back. Fading in longs in this 6430 to 6460 area would make sense for a possible bullish spurt next week.

For the bulls, they now need to push above 6550 which was yesterdays support (now broken) and also the 2 hour chart resistance. We have the hull moving average here and also the coral. This is currently green (uptrend) but may well change to red shortly if we remain below the 6550 level. The bulls will of course be looking for a break higher, and that 6602 level remains the line on the sand for the moment. It might well take a big effort to push through that today, but if they do then 6632 R2 is the next level of note, with 6680 above that. Last minute push from the bulls as we head towards the festive break? I do think we will see the 6550/6555 area be quite strong resistance initially though as we have a cluster of levels here, on both the 2h and also the 30m timeframes. The red coral on the 30min coupled with the 200ema might be quite strong to start with today.

We also have option expiry today so expect some volatility at 10:10 this morning, possibly a spike up which usually then drops back. Bear it in mind.

Have a good trading day and a great weekend.

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