Technical analysis for FTSE 100 for 14th September 2023
The FTSE 100 bounced back on Wednesday after being hit by the news that the economy had shrunk more rapidly than expected in July. By the end of the day a strong performance from banks Barclays and HSBC, as well as some housebuilders, helped the FTSE finish more or less flat
It closed down just 0.02pc a 1.54 point drop that left the index at 7,525.99.
The index had earlier fallen as low as 7,490 after data from the Office for National Statistics revealed that the UK’s gross domestic product (GDP) fell by 0.5pc in July, following a similar-sized rise the month before.
Stocks in Asia broadly climbed on cautious optimism the Federal Reserve may pause rate hikes following the US inflation report that was in line with estimates. The dollar slipped. Japan’s Nikkei 225 outperformed the region and equities in South Korea and Australia gained as a benchmark index for the region snapped a two-day loss. US stock futures also rose. Japanese shares received an extra boost after Economic Revitalization Minister Yoshitaka Shindo said the government will use all policies for economic management and highlighted the need for strongeconomic measures.
Asian stocks rose on Thursday, as traders figured a small upside surprise for U.S. inflation was unlikely to push up interest rates, while the euro was firm leading in to a European Central Bank meeting where expectations lean toward a rate hike.
FTSE 100 technical analysis for today, 14th September 2023
The 7490 level was defended once again yesterday and we have seen a retest of the 7550 level overnight. This is the line that the bulls will be keen to break as it opens up the test of 7595, and I feel that we may well see that today.
First up though, and in a similar vein to yesterday, we have resistance at the 7575 level, with R2 and the key fib here, so we could see a stutter here if we broach the 7550 level.
The ASX200 had a fairly strong day, and with the ECB rate news for today at 13:15 (rates are expected to stay at 4.25%) that may well help the bulls push it up.
Initially though, as we are 7550 to start with, we may well see a dip down to the support level around 7525-7520. With the daily pivot and 30m coral here then I would like this to act as the spring board really for the rise to continue, otherwise a break of this will likely lead to 7500 fairly quickly, and also 7490- once again.
Below 7490 then the bears will be able to push it down towards 7461 for S2 and possibly even 7430, which would then test the bottom of the Raff channels which are both in this area as you can see on the daily chart below.
That said, I think today is more likely to be bullish (and probably tomorrow as well) as the 2h S&P500 chart is looking more optimistic now, and that may well help pull the Dax40 and FTSE 100 up with it. The US bulls will be aiming to break 7499 though as we have R2 and the top of the 10d Raff channel here.
Not too much more to say really, don't forget the ECB rate news at 1315, and good luck today.
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