FTSE 100 live outlook prediction analysis for 8th April 2021
London’s FTSE 250 hit a record high, adding to Tuesday’s gains as traders looked forward to life after lockdown while the pound weakened. The mid-cap market closed at 22,160.57, having gained 166.09 points.
Currency traders, however, were shaken as the UK’s medical advisory body said under-30s will be offered an alternative to the AstraZeneca vaccine due to mounting evidence linking it to rare blood clots.
The pound fell 0.51pc against the US dollar to $1.375 and was down 0.6pc against the euro at €1.157. Shares in drugmaker AstraZeneca lost 84p to £70.99 as one of the key drags on the FTSE 100. Strong economic data helped to push the benchmark FTSE 100 up 61.77 points to 6,885.32. It came as the UK’s services sector rebounded in March while business optimism improved for the fifth month running and was the highest since December 2006.
Keeping Up With China
President Joe Biden promoted his $2.25 trillion infrastructure plan in a White House speech Wednesday, and described its passage as urgent to keep the U.S. competitive against China. Administration officials said the plan enjoys broad support from ordinary Americans and is overdue after decades of under-investment in roads, childcare and other programs. Republicans have balked at the proposed level of spending, the plan’s priorities and the tax increases called for. Here’s our editorial board’s takeon the plan. Meanwhile, Treasury Secretary Janet Yellen unveiled a detailed sales pitch for the administration’s proposed corporate-tax code.
Mixed Markets
Asian stocks are poised for a mixed open Thursday after U.S. equities drifted higher, with investors mulling the latest insights into the Federal Reserve’s relaxed stance on inflation risks. Futures dipped in Japan and Hong Kong and climbed in Australia. The S&P 500 inched up to close at another record despite dwindling volume on U.S. exchanges. Rallies in technology giants including Apple helped push the Nasdaq 100 higher. The dollar rose and Treasury yields edged higher.
Still Dovish
Fed Chair Jerome Powell’s dovish message on an incomplete economic recovery won the day when officials met last month, with a record of the gathering showing a unanimous near-term policy outlook. Officials left their asset purchase program of $120 billion per month unchanged at the meeting and forecast they would keep the benchmark lending rate near zero until at least 2023 to help the U.S. economy heal from Covid-19. That was despite sharply upgrading projections for growth and employment that has had some investors betting the Fed will act sooner.[Bloomberg]
US & Asia Overnight from Bloomberg
Asian stocks were steady Thursday and U.S. equity futures gained after the S&P 500 notched up another record on further evidence of the Federal Reserve’s commitment to supportive policy.
Japanese shares slipped amid concerns Tokyo is planning stricter steps to curb rising virus infections, while Australia and Hong Kong outperformed. U.S. and European equity futures climbed following modest gains in the S&P 500 Index amid dwindling volume on U.S. exchanges. Tech giants including Apple Inc. helped push up the Nasdaq 100. The dollar headed for its fifth decline in six sessions, while Treasuries stabilized.
The British pound snapped two days of losses after coming under pressure because of concerns relating to AstraZeneca Plc’s vaccine, on which the U.K. is heavily dependent. Growing worries that the shot causes rare blood clots could hinder immunization campaigns elsewhere in the world too.
Fed officials were united on the need to see more progress on the recovery before scaling back their massive bond-buying program, according to minutes from last month’s meeting released Wednesday. Policy makers have downplayed inflation risks, maintaining that the recent surge in Treasury yields reflects stronger growth prospects. Traders have scaled back their most-aggressive positioning for interest rates to start rising by the end of next year.
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
The S&P has risen to test the 2 hour resistance at 4102 as I write this and we have a cluster of resistance levels just above this at 4107 with R3 and the key fib there. The bulls have remained strong all week on the S&P but we could see them take a breather here. April is traditionally a strong month for markets and the S&P could run higher, after a possible cooling of the RSI – currently at 74 on the daily.
The FTSE has also pushed higher overnight and is holding above the 6900 level, with the first resistance level of note at 6927 this morning. With R1 and the key fib here we could well see an initial reaction here but the bulls will be keen to defend the 6900 level. Above the 6927 level then we have the top of the 20 day Raff channel coinciding with R2 at 6954 and as such we may well see another bearish reaction here. Of course the chatter in the media will now turn to talk of 7000 again, though the pre-covid high of 7700 remains a fair way off. Above 6960 sees a test of R3 at 7004 looking possibly, though we do also have the top of the 10 day Raff at 6970 before that. Another level to keep an eye out for!
With everything bullish to start with the momentum should mirror the ASX which had a rise and then a slow dip day, and we may well do the same.
For the bears, they will be looking to break the 30m coral at 6900 initially as that will open up a potential test of the daily pivot at 6876. That also aligns with the 2 hour Hull moving average support, though not the first test of it, and may well hold. Below that then the S1 level is 6850, with the 200ema 30m and the key fib below that at 6831. That would look quite bearish though if we slide to that level so I am thinking that more of this slow grind higher will play out.
Watching the S&P really for today to see if the 4107 area gets a reaction, as with the 2 hour bearish but the bulls still in charge this area could be key. The bulls will certainly want to push above it! With the FTSE nearing the top of the Raff as well, we could well see some profit taking kick in, a bit of a cooling of the RSI before the next leg up. Daily RSI for the FTSE is currently 73.
Good luck today, watch for 6927 and 6954 as the resistance levels of note. 6900, 6876 and 6831 as the supports.
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