FTSE 100 Analysis | Signals | Forecast | Prediction | FTSE 100 Outlook | Trading help
Sterling and the FTSE 100 both pushed higher as sentiment remained bullish ahead of the Bank of England decision later this week. The pound rose 0.5pc against the dollar to $1.3503, recording its third straight day of gains.
Markets are fully pricing in an interest rate rise to 0.5pc this week, with as many as five increases by the end of 2022. Speculation is also mounting that the Bank could signal the plan for winding down its pandemic bond-buying programme.
The FTSE 100 was up 1pc at close, with miners and banking stocks leading gains.
Meanwhile, Asian stocks rose Wednesday amid a recovery in U.S. shares spurred by the corporate earnings outlook and signs that Federal Reserve officials favor measured monetary-policy tightening.
Equities advanced in Japan and Australia, among the few markets open in Asia due to the Lunar New Year holiday. U.S. Treasuries were little changed and a dollar gauge held a retreat.
European and U.S. equity futures pushed higher, with contracts on the technology-heavy Nasdaq 100 up over 1% after strong earnings from Alphabet Inc. and Advanced Micro Devices Inc. U.S. stocks on Tuesday posted their best three-day rally since 2020.
Oil steadied near a seven-year high ahead of a meeting of OPEC and its allies on boosting output. Gold fell below $1,800 an ounce. Bitcoin traded around the highest level in two weeks.
Google Growth
Google parent Alphabet jumped in late trading after fourth-quarter sales and profit beat estimates, aided by the strength of its ad business and gains in cloud computing. The company also announced a 20-for-1 stock split, giving an even greater boost to shares. Meta, Snap and Pinterest also rose after the results.
Three-Day Rally
U.S. stocks posted their best three-day rally since 2020 as investors bid up companies that benefit from a strong economy, speculating the Fed won’t derail growth as it fights inflation. Markets remain closed in much of Asia for the Lunar New Year holiday.
FTSE 100 live outlook prediction analysis for 2nd February 2022
Quite the rebound on the S&P since the lows last week when fear ruled the roost, however we have now reached the daily resistance zone and 50%ish retrace of the falls. As such this area is quite key as to whether the bounce is real and sustainable or more of the dead cat variety. Time will tell though one more dip down during Feb and then a “proper” climb would fit quite well.
The FTSE100 continues to march to the beat of its own drum and is nearly back at the 7600 level where we have the daily resistance level. We may well test this level later on though it looks like there will be an initial dip, maybe down to the daily pivot at the 7550 level to start with.
The 2h FTSE100 chart remains bullish also lending support to the 7550 level with the Hull moving average here, and a bit more upside towards the double top at the 7635 level would play out well. I imagine should that happen then we will likely see the bears have a go here, and the bulls bank some profits!
Above the 7638 then we will likely get a push to R2 at 7664 and possibly even 7700 later this week. Quite the potential bounce from 7230 just last Monday!
On the flip side, the initial support is at 7550, then below that we are looking at the 7510 level where we have the key fib and the 200ema on the 30m chart. S1 is also here for today so should we slide that low then a potential long here is worth trying.
Below 7510 and then 7440 is S2 and just below the 7452 daily support, with 7425 Fridays low below that. I am not expecting us to get that low, though we do have the BoE tomorrow with the potential rate hike to 0.5% to temper inflation and cool things down. I don’t think they will risk raising anymore than that at this stage but rather do small increases each quarter to get back to the 1.5% area by year end.
We also have NFP on Friday this week.
Gold has broken below the 1800 level for the moment and the daily chart has 1810 as resistance. The bulls will be keen to get back above that though a drop down to the 1790 area looks likely.
The Dax is not far off the red daily coral at 15788 so we may well see that act as resistance and we also have R1 here at 15801 so keep an eye on this area to temper any bounce today. A break of the daily pivot at the 15641 level may well see a drop down to the 15550 level, with a potential drop down to the 15400 on the cards as we have the 200ema daily here.
If the S&P bears are going to seize their moment again then it will likely be in this 4580 area so I am watching that level closely. We have just hit this area as we also hit results season which may enable the bulls to remain in charge and make this rise stick but technically we should see some sort of bearishness around here. Interesting times!
So, keep an eye on 7600 and 7635 as the main resistance levels today, 7550 and 7510 as the main supports.
Good luck today.
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