FTSE 100 live outlook prediction analysis for 10th November 2020
Markets around the world surged by almost $2 trillion on Monday as investors bet that a Covid vaccine could allow life to return to normal within months. The FTSE 100 rocketed 4.7pc higher in its best day since March, adding £70bn to the value of Britain’s blue-chip companies after Pfizer announced blowout results from a large-scale trial of its coronavirus jab.
European markets also surged, with Paris up 7.6pc and Frankfurt climbing 4.9pc, while Wall Street’s S&P 500 rose by 3.2pc to a new record high before paring gains in late afternoon trading to end up 1.2pc. The benchmark missed closing at above the all-time high set on September 2, by just 0.8pc. Global stock markets gained nearly $2 trillion (£1.5 trillion) in value across the day, with Asian markets expected to push higher still when trading re-opened overnight.
Investors piled back into stocks which suffered most when the pandemic sent stock markets tumbling in spring. Jet engine-maker Rolls-Royce closed up 44pc, having jumped as much as 97pc during afternoon trading in one of the biggest increases ever recorded by a FTSE 100 company, while British Airways owner IAG surged 26pc on hopes that a brutal crisis in air travel is finally nearing its end.
Vision Of Hope
Almost a year into the coronavirus outbreak, some good news. One of the Covid-19 vaccines that was accelerated into trials earlier this year seems to work. The experimental shot, developed by Pfizer and German biotechnology firm BioNTech, appears more than 90% effective in stopping Sars-Cov-2 infections, the companies said Monday. A vaccine at that level of effectiveness, administered widely, is enough to break chains of infection. Pfizer shares rose as much as 15%, while BioNTech American depositary receipts surged as much as 24%. The companies have agreed to supply deals with the U.S. and with other countries, but it’s likely that front-line medical and essential workers, and at-risk groups, will receive a shot first. The global economic outlook could materially change for the better following Monday’s promising results.
Markets Lift
Asian stocks looked poised for gains Tuesday after the S&P 500 Index closed at a two-month high amid strong volume following Pfizer’s news. Bonds and other haven assets tumbled. Futures indicated gains of at least 1% in Japan, Australia and Hong Kong. The Nasdaq 100 fell as investors rotated out of defensive technology names into shares depressed by the economic impact of lockdowns. Still, the broader U.S. stock gauge pared gains on concern that lawmakers will pass a smaller stimulus package. Elsewhere, yields on 10-year Treasuries soared to the highest since March. Oil surged, while gold, the Japanese yen and the Swiss franc slumped. The dollar rose.[Bloomberg]
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
A rally in global stocks stalled in Asian trading Tuesday amid concerns a large-scale coronavirus vaccine study still has hurdles to clear despite promising results. Bonds and other haven assets climbed after overnight declines.
Shares pared gains in Japan, Hong Kong and Australia, and Chinese stocks fell. S&P 500 futures and European contracts declined. Concerns about a smaller U.S. fiscal stimulus package, still surging coronavirus cases and legal challenges to the U.S. election outcome weighed on the positive vaccine sentiment.
Earlier, the S&P 500 closed at a two-month high on news the coronavirus shot being developed by Pfizer Inc. and BioNTech SE prevented over 90% of infections. The Nasdaq 100 fell as investors rotated out of defensive technology names into shares depressed by the economic impact of lockdowns.
The S&P has defended the 3520 level overnight where we have the green coral line and we are just seeing a small bounce off this so far this morning as I write this. That has helped the FTSE 100 to hold the 6100 level overnight. For today I am seeing a range between 6200 and 6090 to be in play. We may also have a slight bearish bias as we consolidate after that rise yesterday. Bear Tuesday to follow a bull Monday after all! Positive news either way from Pfizer, hopefully some of the companies that saw significant rallies (IAG, Rolls Royce, etc) don’t run out of money till travel/their core market picks up again though!
6100 is now showing as the Hull moving average support on the 2 hour chart, and if we do drop back to that area, then we will also back test the previous (supposedly!) daily resistance level of 6088 which in theory would become support. We also have the key fib support at 6090 for today, so I think that should we drop back to this level then we may see the bulls defend this. A break of this and there will be a large slide though, and yesterday will have turned into a massive bull trap! It does tie in with that 3520 level looking significant on the S&P, and the bulls will certainly want these levels to hold.
Below 6090 then 5975 is the 2 hour coral on the FTSE, and as such a decent looking support level. That also ties in with the 200ema on the 30min at 5963 (and rising). Given the recent climb in the FTSE overall the daily chart remains bullish with 25ema support at 5877 currently. Should things get bearish again, then we may well see a test of this 25ema line at some point.
For the bulls, the main resistance to start with today is at the 6200 level where we have the 200ema on the daily, a key fib resistance and also the 30min coral. Th bulls will be keen to break this though as we should then get a retest of the highs from yesterday at 6265, and possibly R1 at 6300. I think the upside will be dependant on the S&P pushing above the 3590 resistance level on its 2 hour cart currently, and a hold of 3520 is key. The Dow Jones hit the 30,000 level yesterday for the first time, but then dropped back from there 28870, but has started to rise again. The bulls would certainly like to regain 30k I would imagine!
As such we may see a bit of consolidation today after that mega move yesterday, I am liking the 6090 level as support, with 6000ish below that. For resistance, 6200 initially, with 6065 then 6300 above that. A lot will depend on the US bulls defending the 3520 level today.
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