FTSE 100 outlook | Asian shares slide | 7405 7445 resistance | 7380 7350 7335 support | House prices rise

Asian shares slide | 7405 7445 resistance | 7380 7350 7335 support | House prices rise

FTSE 100 outlook prediction analysis for 29th November 2019

Markets were fairly slow on Thursday, with Wall Street off work for Thanksgiving and only a handful of UK companies reporting.  The pound shook off some of its gains as the day went on, but remains testing the $1.30 level as expectations of a clean Boris Johnson victory appear to increase. Here are the day’s top stories:

  • A recent European share price rally turned into a retreat after US President Donald Trump signed a bill supporting pro-democracy protesters in Hong Kong.
  • The Institute for Fiscal Studies crunched the numbers on the Labour and Conservatives manifestos, concluding neither party’s spending promises are “credible”
  • Virgin Money shares leaped by more than a quarter despite PPI claims wiping out profit
  • French power giant EDF announced plans to build giant windfarm off coast of Fife
  • Loans company Amigo shares jumped after the company’s revenues rose
  • Housing data showed the strongest increase in prices since April

Warning Signs

From rural bank runs to surging consumer indebtedness and an unprecedented bond restructuring, mounting signs of financial stress in China are putting the nation’s policy makers to the test. Xi Jinping’s government faces an increasingly difficult balancing act as it tries to support the world’s second-largest economy without encouraging moral hazard and reckless spending. While authorities have so far been reluctant to rescue troubled borrowers and ramp up stimulus, the costs of maintaining that stance are rising as defaults increase and China’s slowdown deepens. For now, investors appear to be betting that policy makers can manage the country’s financial risks and keep the economy afloat.

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

The FTSE got a reaction at the 7420 resistance level yesterday and has dropped off overnight, and if the bears were to break the 7380 support level I am looking at a drop down to 7355 and also possibly the daily support at 7335. Asia had a weak last day of the month today and if we get some profit taking after this rise from 7190 we may well see the same.

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

I am still thinking that we drop down to test the daily support before more upside in December though, and that makes the 7335 level look important.

The 2 hour chart remains bearish and has resistance at the 7446 level for today so should we get that high then a short here looks viable. This is also a double top area for November with the 27th November high and as such also looks important. The bulls will be keen to break this level as it keeps 7500 in play and further tests of the top of the Raff channels.

The bulls will need to break above the 30min resistance initially though which is sitting at 7405 to start with and with the daily pivot and a red coral line here we may well see a drop off from this area in a repeat of the bearishness in Asian markets. If they were to push past this towards the 7450 level then 7466 is daily resistance above that. If we were to have a bullish session we may well see a stutter around here later in the day.

Initial support is at the 7380 area we bounced from yesterday and then the 7350 level below that. That would be the first target for any shorts and then the 7336 below that.

Friday, end of month, and the day after Thanksgiving so could be an interesting one. Watching the 7380, 7350, 7336 levels as support. 7405, 7446, 7466 as resistance. Good luck today and have a good weekend.

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  1. – UK Mortgage Approvals (Oct): 64.6K (est 65.4K, prevR 65.8K)
    – UK Net Consumer Credit (Oct): 1.3Bln (est 0.9Bln, prev 0.8Bln)
    – UK Consumer Credit Oct (Y/Y): 6.1% (prevR 5.9%)
    -UK Net Lending Sec On Dwellings (Oct): 4.3Bln (est 3.8Bln, prevR 3.9Bln)

  2. – German Unemployment Change (000’s) Nov: -16K (est 6K, prevR 5K)
    – German Unemployment Claims Rate SA Nov: 5% (est 5%, prev 5%)

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