FTSE 100 live outlook prediction analysis for 20th November 2020
London’s FTSE ended down 51p in trading to 6,334.35 – lower than its level on Tuesday morning – to wipe out this week’s gains. A third announcement from AstraZeneca failed to impress traders, as it didn’t reveal how effective its vaccine is after Moderna and Pfizer’s earlier positive announcements. Fears of rising Covid cases, tighter lockdowns and economic impact prevailed.
- FTSE 100 slides as market tug-of-war continues
- IMF chief says poverty and inequality worsening
- Watchdog fines ComparetheMarket £17.9m for competition breach
- US market dropped amid a tech selloff
- Electric car push set to drive energy bills higher
Britain and Canada are very close to agreeing the terms of a free trade deal, and an announcement could come in the next few days. British Trade Minister Liz Truss earlier said the government of Boris Johnson was determined to reach a trade deal with Canada before the end of the year.
Recovery Threatened
The IMF and the Group of 20 warned that the recovery from this year’s recession is at risk and could be derailed as the resurgence of Covid-19 forces fresh restrictions on households and companies. The IMF noted progress on a vaccine, but also said elevated asset prices point to a disconnect from the real economy and a potential threat to financial stability. “The recovery is uneven, highly uncertain and subject to elevated downside risks, including those arising from renewed virus outbreaks in some economies,” the G-20 said, ahead of a virtual summit this weekend hosted by Saudi Arabia. Among the worst- affected major economies is India, according to Oxford Economics. Meanwhile, even outdoor exercise is banned in one of the world’s toughest lockdowns in Australia.
Muted Markets
Asian stocks looked set for a muted open Friday after technology shares led U.S. benchmarks higher. Futures pointed to modest gains in Japan, Australia and Hong Kong. U.S. stimulus looks set to return to investor focus after a clash between Treasury Secretary Steven Mnuchin and the Federal Reserve on its emergency lending facilities. The S&P 500 Index closed higher on Thursday but underperformed the tech-heavy Nasdaq 100. Treasury yields retreated and the dollar dipped, while Turkey’s lira strengthened after the country’s new central bank governor raised the benchmark interest rate.
New Team
President-elect Joe Biden assailed the Trump administration’s lack of cooperation on the presidential transition, which he says hinders his team’s ability to get up-to-date information on the coronavirus pandemic. “It’s just outrageous what he’s doing,” Biden said, referring to Trump’s legal maneuvers to overturn the election result. Separately, Biden said Thursday he has chosen a Treasury secretary, promising an announcement either next week or the week after. Names he is said to have been considering include current Federal Reserve governor Lael Brainard, former Fed governor Roger Ferguson, and former Fed Chair Janet Yellen.[Bloomberg]
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
U.S. futures retreated Friday after a dispute between Treasury Secretary Steven Mnuchin and the Federal Reserve over its emergency lending facilities. Asian stocks were little changed.
S&P 500 contracts slipped after the Trump administration and the Fed publicly disagreed over whether to extend the pandemic programs. Stocks edged lower in Australia and Japan and fluctuated in China. Treasuries, gold and the dollar were flat.
Technology stocks had led U.S. benchmarks higher Thursday as investors weighed tougher virus curbs against the prospect of a vaccine rollout in the months ahead. Shares of firms seen as beneficiaries of lockdowns outperformed.
The FTSE dropped off the 2h Hull moving average in the evening yesterday at 6370, and has once again dropped down to the 6320 area where we have found a bit of support overnight. As we have climbed back off this level we have initial support at the 6338 level with the daily pivot here, along with the 30min coral and the 200ema (30min) and as such we may well see this level hold initially. If it does then we should et a rise towards the 6380 level again, and the bulls will be keen to break this today as it leads us to the 6425 R3 level. 6385 however is also the red 2 hour coral line now, so we may well see some bears appear here.
The S&P still needs to break above the 3585 level to open up further upside, and it dropped off that level again yesterday. However, it is defending 3550 still so could well be coiling for a break higher. Will we get the usual US Friday afternoon pump once again? If the bulls manage to break it then we may well see a test of R3 at 3617 today.
For the FTSE bears, a break of the 6338 level will likely see another test of the 6310/20 level with a possible break lower today towards the 6284 support level. This is also just above S2 for today at 6276, However if it does get bearish enough to break these levels then a drop down to the 200ema on the daily at 6218 will probably play out. With the bottom of the 10 day Raff also at this level then I would like to see that hold and as we are getting into year end mode, we may well see a bit of a rally kick in from here. Below this though, the 25ema at 6104 would be the next major support.
As its Friday it pays to be a little bit more cautious today. Watching the 6337 for initial support with 6280 below that. For resistance, 6385 then 6430. Good luck today and have a great weekend.
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