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Rise and dip today but bears need to break 6550 | 6615 6650 6675 resistance

#1 · 24th February 2021, 10:01 am

Quote from Nick on 24th February 2021, 10:01 am
FTSE 100 live outlook prediction analysis for 24th February 2021
UK stocks bucked a European sell-off on Tuesday on hopes of an economic recovery after Boris Johnson said he was “very optimistic” all coronavirus restrictions in England would end on June 21. This was enough to offset any worries over fresh data from the Office for National Statistics that showed Britain’s unemployment rate rising to 5.1pc in the final three months of last year, the highest recorded since the first quarter of 2016.

Investors focused on the positive and cheered the UK’s potential roadmap out of lockdown as they banked on the recovery of sectors hard-hit by the pandemic.
The FTSE 100 – which was in the red for the best part of the day dipping as much as 1.7pc – ended up 0.2pc or 13.7 points to 6,625.94, while the FTSE 250 accelerated in late afternoon to finish with an additional 76.63 points to 21,057.72. Travel, hospitality and commercial landlord stocks were among some of the day’s best performers.
Ongoing Support
Federal Reserve Chairman Jerome Powell signaled that the central bank was nowhere close to pulling back on its support for the pandemic-damaged U.S. economy, even as he voiced expectations for a return to more normal, improved activity later this year. Before the Senate Banking Committee Tuesday, he also played down concerns of an inflationary outbreak from another big fiscal stimulus package or from an unleashing of pent-up demand as a growing number of Americans are vaccinated against the virus. And he called the recent run-up in bond yields that has unsettled the stock market “a statement of confidence” in a robust economic outlook.
Roaring Back
U.S. stocks reversed losses after Jerome Powell's reassuring comments and Asian equities look set for a mixed start. The S&P 500 Index erased a drop to end Tuesday higher, though declines among technology shares left the Nasdaq 100 down. Airlines, lodging companies and cyclical shares set to benefit from the end of pandemic lockdowns were the biggest winners. Treasuries were volatile, with 10-year yields initially rising before fading to hover around 1.36%. Elsewhere, Bitcoin tumbled below $50,000 after a bout of volatility highlighted lingering doubts about the durability of the token’s rally. Oil dipped in New York as technical indicators signaled prices are due for a pullback following a strong rally this month.[Bloomberg]
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US & Asia Overnight from Bloomberg
Stocks fell with U.S. equity futures Wednesday as investors balanced the risk of stronger inflation driving global rates higher against the Federal Reserve’s pledge of continued policy support. Treasuries were steady.
A gauge of Asian shares declined to the lowest in more than two weeks. Hong Kong equities tumbled on the city’s plan to raise stamp duty on stock trading. Chinese gauges retreated for a third day. European equity contracts dipped.
Earlier, the S&P 500 Index reversed losses to close in the green following Fed Chair Jerome Powell’s message Tuesday that the central bank was nowhere close to unwinding its easy policy. Cyclicals outperformed, while the tech heavy Nasdaq 100 closed lower despite a late rally.
Ten-year Treasury yields held just below the one-year high reached Monday. The dollar was little changed. The New Zealand dollar advanced even as the central bank said “prolonged” stimulus was needed. Oil declined after an industry report pointed to the first gain in U.S. crude stockpiles in five weeks.
Powell voiced cautious expectations for a return to more-normal activity later this year and said that higher bond yields reflected economic optimism, not inflation fears. While that helped assuage some investors betting on a global recovery spurred by vaccines and fiscal aid, there are also lingering concerns that stock valuations are stretched.
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
Cheeky spike up to 6677 yesterday just shy of the 6688 resistance level, before dropping back and the bears have managed to break 6600 overnight. Cable has continued to rise (141 now on GBPUSD) and that will weigh on the FTSE 100 for the moment.
The 6550 support level has held a few tests so far and looks like its about to be tested again - as such we may well see an initial rise from this area this morning towards the 6620 area where we have a cluster of resistance levels. Namely the 30min coral now red, the daily pivot, and the 200ema on the 30m. As such I am thinking that a short here is worth a go as the bears will be keen to try and break that 6550 level so we can drop down to the next daily support at the 6495 level.
The bulls may try and push on though and above the 6620 level then we still have the 6688 level to watch, though yesterdays high at 6677 may also see a reaction. Above that though and the R2 level coincides with the 10d Raff cannel top at 6738. Not convinced that we push that high today though, especially as gold seems to finally be swinging back to a bullish stance (front running again possibly)
If the bears were to break 6495 though then the next main support is the 200ema on the daily chart at 6393. However that would also involve breaking both the Raff channel bottoms (both around the 6490 level) and again, I am not thinking it will do that today.
The S&P is on its 30m support here at 3860 as I write this, and we may well see a push up on that towards the 3917 R1 level this morning. The bulls fought back strongly from the 3808 level yesterday with another fake break of the support at 3820 (or a bear trap!). If they can break 3917 then 3957 is next up, while a break of 3808 will get it bearish for a while and 3768 S2 is next up.
So still thing shorting the rallies is the right play for the moment and watching the 6620 level for an initial reaction. Good luck today.
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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.
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FTSE 100 live outlook prediction analysis for 24th February 2021

UK stocks bucked a European sell-off on Tuesday on hopes of an economic recovery after Boris Johnson said he was “very optimistic” all coronavirus restrictions in England would end on June 21. This was enough to offset any worries over fresh data from the Office for National Statistics that showed Britain’s unemployment rate rising to 5.1pc in the final three months of last year, the highest recorded since the first quarter of 2016.

Investors focused on the positive and cheered the UK’s potential roadmap out of lockdown as they banked on the recovery of sectors hard-hit by the pandemic.

The FTSE 100 – which was in the red for the best part of the day dipping as much as 1.7pc – ended up 0.2pc or 13.7 points to 6,625.94, while the FTSE 250 accelerated in late afternoon to finish with an additional 76.63 points to 21,057.72. Travel, hospitality and commercial landlord stocks were among some of the day’s best performers.

Ongoing Support

Federal Reserve Chairman Jerome Powell signaled that the central bank was nowhere close to pulling back on its support for the pandemic-damaged U.S. economy, even as he voiced expectations for a return to more normal, improved activity later this year. Before the Senate Banking Committee Tuesday, he also played down concerns of an inflationary outbreak from another big fiscal stimulus package or from an unleashing of pent-up demand as a growing number of Americans are vaccinated against the virus. And he called the recent run-up in bond yields that has unsettled the stock market “a statement of confidence” in a robust economic outlook.

Roaring Back

U.S. stocks reversed losses after Jerome Powell's reassuring comments and Asian equities look set for a mixed start. The S&P 500 Index erased a drop to end Tuesday higher, though declines among technology shares left the Nasdaq 100 down. Airlines, lodging companies and cyclical shares set to benefit from the end of pandemic lockdowns were the biggest winners. Treasuries were volatile, with 10-year yields initially rising before fading to hover around 1.36%. Elsewhere, Bitcoin tumbled below $50,000 after a bout of volatility highlighted lingering doubts about the durability of the token’s rally. Oil dipped in New York as technical indicators signaled prices are due for a pullback following a strong rally this month.[Bloomberg]

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US & Asia Overnight from Bloomberg

Stocks fell with U.S. equity futures Wednesday as investors balanced the risk of stronger inflation driving global rates higher against the Federal Reserve’s pledge of continued policy support. Treasuries were steady.

A gauge of Asian shares declined to the lowest in more than two weeks. Hong Kong equities tumbled on the city’s plan to raise stamp duty on stock trading. Chinese gauges retreated for a third day. European equity contracts dipped.

Earlier, the S&P 500 Index reversed losses to close in the green following Fed Chair Jerome Powell’s message Tuesday that the central bank was nowhere close to unwinding its easy policy. Cyclicals outperformed, while the tech heavy Nasdaq 100 closed lower despite a late rally.

Ten-year Treasury yields held just below the one-year high reached Monday. The dollar was little changed. The New Zealand dollar advanced even as the central bank said “prolonged” stimulus was needed. Oil declined after an industry report pointed to the first gain in U.S. crude stockpiles in five weeks.

Powell voiced cautious expectations for a return to more-normal activity later this year and said that higher bond yields reflected economic optimism, not inflation fears. While that helped assuage some investors betting on a global recovery spurred by vaccines and fiscal aid, there are also lingering concerns that stock valuations are stretched.

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

Cheeky spike up to 6677 yesterday just shy of the 6688 resistance level, before dropping back and the bears have managed to break 6600 overnight. Cable has continued to rise (141 now on GBPUSD) and that will weigh on the FTSE 100 for the moment.

The 6550 support level has held a few tests so far and looks like its about to be tested again - as such we may well see an initial rise from this area this morning towards the 6620 area where we have a cluster of resistance levels. Namely the 30min coral now red, the daily pivot, and the 200ema on the 30m. As such I am thinking that a short here is worth a go as the bears will be keen to try and break that 6550 level so we can drop down to the next daily support at the 6495 level.

The bulls may try and push on though and above the 6620 level then we still have the 6688 level to watch, though yesterdays high at 6677 may also see a reaction. Above that though and the R2 level coincides with the 10d Raff cannel top at 6738. Not convinced that we push that high today though, especially as gold seems to finally be swinging back to a bullish stance (front running again possibly)

If the bears were to break 6495 though then the next main support is the 200ema on the daily chart at 6393. However that would also involve breaking both the Raff channel bottoms (both around the 6490 level) and again, I am not thinking it will do that today.

The S&P is on its 30m support here at 3860 as I write this, and we may well see a push up on that towards the 3917 R1 level this morning. The bulls fought back strongly from the 3808 level yesterday with another fake break of the support at 3820 (or a bear trap!). If they can break 3917 then 3957 is next up, while a break of 3808 will get it bearish for a while and 3768 S2 is next up.

So still thing shorting the rallies is the right play for the moment and watching the 6620 level for an initial reaction. 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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