Technical analysis for FTSE 100 for 1st May 2024
All major European markets (ex-UK) are closed today for Labour Day.
The FTSE 100 ended subdued on Tuesday, as strength in financials following strong updates from HSBC and Hargreaves Lansdown (LON:HRGV) was offset by a sell-off in metal mining stocks.
The blue-chip FTSE 100 had extended its record rally for the sixth straight session earlier in the day, hitting an all-time high of 8,199.95 points. However, the index ended the session flat.
The midcap FTSE 250 edged 0.6% lower to 19,965.39 points, after having breached the 20,000 mark in the previous session.
Both indexes marked their second consecutive monthly gain. Signs of inflation coming under control, a recovering economy, upbeat corporate results and reasonable prices is attracting more buyers to Britain.
Global investors now await the U.S. Federal Reserve's policy decision on Wednesday. The Federal Reserve Open Market Committee gathered on Tuesday for its monetary policy meeting, which is expected to culminate on Wednesday with a decision to leave the Fed funds target rate in the 5.25% to 5.50% range.
U.S. equity markets closed sharply lower on Tuesday, joining their global counterparts in the monthly loss column as investors await crucial economic data and the Federal Reserve convenes for its two-day policy meeting.
Gold sank, the dollar rebounded and benchmark U.S. Treasury yields ticked higher after the U.S. Labor Department reported hotter-than-expected first-quarter employment cost growth, which is unlikely to alter the Fed's restrictive stance.
Asia Pacific Markets
Asian markets closed mixed on Tuesday, with Japan's Nikkei 225 adding 1.24%, Hong Kong's Hang Seng Index gaining 0.09%, China's Shanghai Composite falling 0.26% and India's S&P BSE Sensex falling 0.25%.
Japan’s housing starts fell by 12.8% year-over-year in March following an 8.2% decline in the previous month. Retail sales in Japan climbed 1.2% year-over-year in March, while industrial production in rose 3.8% month-over-month in March.
Fed jitters
Equities fell to their worst month since September on speculation that Federal Reserve officials will keep rates unchanged at a two-decade high when they conclude their meeting Wednesday — a perception that also drove bond yields up alongside the dollar. The meeting, to be followed by a press conference by Fed Chair Jerome Powell, came after economic data showed a plunge in consumer confidence and persistent wage pressures. The last time Powell spoke, he pointed to the lack of further progress in taming inflation and to enduring strength in the labor market. The latest data — in tandem with expectations for a robust employment report on Friday — aren’t likely to lead him to change his tune. The S&P 500 fell 1.6%, while Treasury two-year yields topped 5% — the highest level since November.
FTSE 100 technical analysis for today, 1st May 2024
Start of the month so a kick up to start with is likely but with all European markets closed for Labour Day, apart from the FTSE100, it may be more lacklustre than usual.
That said I am still thinking that we will get a rise and dip play out today and a test of the 8200 level again. 8204 remains as daily resistance and a double top with yesterday would fit the charts pretty well. The Raff channels continue to head up on the FTSE100 as well and the bottom of the 10d channel aligns with S3 for today.
We do have the FOMC later (1900) and rates expected to remain unchanged. Traders will be watching the press conference at 1930 for rate guidance clues. Still doubt much will change in the near term though.
Initial support today is at the 30m 200ema at 8127, and that would also tie in with a double bottom with yesterday. If that level holds then a rise and dip should play out today.
Below that then the bears will be aiming for the 8099 S1, and key fib just below that at the 8092 level. If it gets bearish today then we may well see a test of the daily support lower down at 8058 and as that is just below S2 then I would like to see this hold and a decent bounce here.
To start with the bulls will need to break above the daily pivot and the 30m red coral at 8150 and if they do so then 8180 R1 and 8204 are targets. Some new month month money flowing in first thing may also help proceedings.
Above 8204 then 8231 is R2 and 8262 for R3, though I don't think that either of these will be tested, at least in hours.
Good luck today
Interested in how to start trading the FTSE 100? Frequently Asked Questions on Spread betting
Recommended Broker for FTSE 100 trading and how to start trading using support and resistance
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, Trading Tips, Support and Resistance Levels with 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 100, DAX40, Gold and S&P 500.
- Daily email pre market includes my trading plan for the day including ORDER levels, with stops and targets/limits
- Telegram live trading room and group membership for discussion and realtime trade updates
Keep up to date with new content, free sign up below with just your email address
