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FTSE100 live outlook prediction analysis for 1st June 2023
The FTSE 100 ended 1.01pc lower at 7,446.14, after stocks on the commodity-heavy index slipped as weak China economic data drove commodity prices lower. The exporter-heavy index was also weighed down by uncertainty over the US debt ceiling agreement which will be voted on later today.
The FTSE 100 recorded a 5pc drop in May, its worst May performance since 2015.
Most Asia-Pacific stock markets rose on Thursday amid receding bets for a U.S. rate hike this month and relief over the passage of the U.S. debt ceiling bill through the House.
The dollar sagged to a one-week low versus the yen and hung close to Wednesday’s more-than-two-month trough to the euro after Federal Reserve officials including Governor and vice chair nominee Philip Jefferson pointed to a rate hike “skip” at the June 13-14 policy meeting. Treasury yields rose slightly from nearly two-week lows.
Crude oil prices edged off four-week lows following a surprise swing back to growth in a private survey of Chinese factory activity, with an OPEC+ meeting looming on the weekend.
Start of the month so we may well see an initial kick up with the new month money, especially as the bulls have managed to hang in there overnight. Still a portion of the 7440 long running from yesterday too with the stop at breakeven now. The bulls need to crack the 7500 level though as we have the Hull MA 2h resistance here and also being the round number.
The Raff channels on the daily are still heading down and it’s still possible that we see a drop down to the daily support at 7360. We have the bottom of the 10d Raff channel in that area, though the bottom of the 20d is closer to where we are at 7420. A break of 7440 will likely see that and we also have the key fib here.
We have US NFP jobs data out tomorrow as well, along with unemployment so traders will be wary of loading up too much ahead of that. An increase in unemployment and a decrease in jobs is forecast.
Initial resistance for the FTSE100 is at the 7500 as mentioned then above that the 7550 level has the 30m 200ema here, though R1 and the key fib split it at 7520. As such 7520 may well get a reaction later on. Above 7550 then 7583 is the next level to watch for though might be a tall order for today.
Support wise, then below that 7420 level will likely see a slide down to the 7360 level and a level that I would like to see hold and set up a decent bounce. “Sell in May” did kick in a bit in the end, with a 5% drop in May.
To lend weight to the index bears, on the 2hr timeframes we have a bullish gold chart (safe haven), and bearish Dax40, S&P500 and FTSE100. As such, we could well see some more pessimism. The media in the UK are stoking it a bit too currently with talk of recession and doom and gloom. Won’t be much longer till the lows are in if they are trying to spook things…..
The S&P500 looks like a rise towards the 7212 area is on the cards today to test the Hull MA on the 2h here, before a drop off again. Could tie in with the Dax40 rising towards the 15830 2h resistance level as well.
Good luck today!
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