Quote from Nick on 24th March 2021, 10:26 am

FTSE 100 live outlook prediction analysis for 24th March 2021

Trustpilot saw strong investor demand for its IPO with the order book covered within about 90 minutes after it opened last week. It came on a weak day for London markets predominantly on the back of rising virus infection rates and tougher lockdowns on the Continent, which dampened global expectation of an imminent global recovery. The threat of a potential vaccine export ban from the EU.

A combination of those factors left the blue-chip FTSE 100 index down a slight 26.91 points to 6,699.19, while the domestically focused mid cap FTSE 250 slid 124.13 to 21,331.76.

Declines came despite a slump in the value of the pound, which typically boosts blue chips, after the currency reacted to talk of a potential vaccine ban from the EU - another headwind of the day. Sterling slumped 0.7pc against the US dollar to $1.377, a six-week low.

The price of oil also fell over concerns demand may drop if travel is impacted by tightened European restrictions, reversing a recent rally. Brent crude dropped over 3pc to $62.39 per barrel.

Airline stocks continued to be hammered for a second consecutive session after the Government extended the ban of foreign holidays until the end of June.

Pandemic Pill

Pfizer is starting human safety tests of a pill to treat the coronavirus. The drug is designed to be administered at the first signs of illness to prevent patients from becoming very sick. The tests could generate results within weeks, the company's Chief Scientific Officer Mikael Dolsten said. Meanwhile AstraZeneca's vaccine headaches continue, with a U.S. agency questioning the shot's 79% efficacy reading. Vaccinating some of the world's most remote communities is testing Australia, and India is accelerating its inoculation drive as infections rise. The WHO says increasing cases and deaths around the world represent “truly worrying trends,” and is warning rich nations against hoarding vaccines.

Weaker Stocks

Asian stocks are poised to open weaker after setbacks to the recovery from the pandemic weighed on U.S. equities. Futures pointed lower in Japan and Hong Kong and were steady in Australia. The dollar strengthened while the 10-year U.S. Treasury yield slid for a second day, as Federal Reserve Chair Jerome Powell said prices would rise this year but that he did not expect inflation to get out of hand. Oil dropped below $60 a barrel on concerns the market is oversupplied.[Bloomberg]

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US & Asia Overnight from Bloomberg

Asian stocks and European equity futures declined Wednesday after setbacks to the recovery from the pandemic weighed on U.S. shares and crude oil, and drove haven trades into Treasuries and the dollar.

A gauge of Asia-Pacific shares fell the most in about two weeks, with value and cyclical sectors struggling. Hong Kong equities underperformed, nearing a correction, amid the city’s decision to temporarily suspend BioNTech SE vaccines. The S&P 500 fell Tuesday and reopening favorites like the small-cap Russell 2000 slumped. S&P 500 futures were steady. Nasdaq 100 contracts rose.

U.S. bond yields headed for a third day of declines after Federal Reserve Chairman Jerome Powell played down inflation risks. A solid two-year Treasury auction helped allay concerns that poor appetite for this week’s sales could stoke yields. The rate on New Zealand’s 10-year note slumped as traders pulled back positions for early rate hikes.

Oil held below $60 a barrel after tumbling Tuesday. Renewed lockdowns in Europe further clouded the prospects for a speedy recovery in consumption.

Market sentiment has faltered on doubts about the progress of the global economic reopening. Germany, France and Italy have widened virus-related curbs and infections are spiking elsewhere. The head of the World Health Organization called recent increases in deaths and cases “truly worrying trends.” These concerns are adding to the ripple effects of quarter-end portfolio balancing across markets.

At the same time, the U.S. government plans more measures to spur growth. Treasuries have benefited from the central bank’s latest assurances of continued support. These are reminders of the fragility of the recovery as investors contemplate the 75% rally in the S&P 500 since its bear-market trough a year ago.

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

Bears are sharpening their claws and the FTSE has dipped below the 6700 level yesterday and held there overnight. The 2 hour chart remains bearish to start with, and the red coral resistance remains untested and sits at the 6715 level - if we get an initial climb to this area then a short here looks to be worth a go as it feels like we could well see slide down to the bottom of the Raff channels in the not too distant future, down at 6620 for today. 6635 is also the daily support level and we have the key fib here for today. That is also just below S1 at 6640.

The 6660 area has held well every day since Friday and we may well see an initial climb from this, though the more it's tested the more likely it is to break.

Initially we have resistance at 6680 with the daily pivot and the Hull moving average on the 2 hour chart both here. The bulls will need to be strong out the blocks to push through this first thing. I do like the look of a rise to that 2h coral at 6715 though.

Should the bulls break above the 6720 level then 6750 R2 would likely be seen, and I would look to go long on a break through 6720 to target that or slightly higher.

If the bears were to break below the 6660 then as mentioned a slide down towards the 6630ish area looks like it will play out. I haven't plotted the arrows on this though as the S&P may well want to defend the 3900 level and we dont slide that low, but do bear it in mind.

On the S&P 3918 is now the 2 hour resistance level of note and the bull may well struggle to break that if the slide from 3990 is to continue - if they do break below the 3900 level then we may well get more bearish across the board, and a slide down to the bottom of the 10 day Raff at 3845 looks likely.

So, still thinking that shorting the rallies for today looks sound, 6715 being the area of note.

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