Rise and dip with 8237 8264 resistance | 8180 8148 support

Rise and dip with 8237 8264 resistance | 8180 8148 support

Technical analysis for FTSE 100 for 9th July 2024

London stocks began the week on a muted note, with resource shares edging lower and investors awaiting fresh economic data, while gains in non-life insurers helped cushion the market from steeper losses.

The blue-chip FTSE 100 was down 0.1% at 8,193.49, while the mid-cap FTSE 250 was flat at 20,798.32. The pound gained 0.1% against the dollar.

On Friday, the midcap index soared to a two-year high as investors celebrated the Labour Party's victory, optimistic that Prime Minister Keir Starmer's plans will invigorate the economy.

Precious metals  lost 1.9% while industrial metal miners slipped 1%, tracking lower bullion and copper prices. Energy shares fell 1.2%, due to a dip in oil prices as the prospect of a Gaza ceasefire deal eased geopolitical tensions, while investors assessed potential disruption to U.S. energy supplies from Tropical Storm Beryl.

On the radar this week are crucial consumer prices index figures in the U.S. and Britain's gross domestic product numbers (GDP), which could shed some more light on the future trajectories of interest rate cuts in the both the economies.

With the UK election now over, investor focus will return to data to gauge the Bank of England's decision at its next meeting in August.

Asia & Overnight
Japan's Nikkei hit a record high on Tuesday, while investors elsewhere waited anxiously to see if Federal Reserve Chair Jerome Powell would sound supportive of rate cuts after evidence the U.S. labour market is cooling.

Europe is set for a lower open, with EUROSTOXX 50 futures off 0.3% and FTSE flat. S&P 500 futures gained 0.2% and Nasdaq futures firmed 0.3%, after Wall Street equities inched higher to close at record highs on Monday.

The Nikkei index umped 1.5% to a fresh record high thanks to gains in semiconductor shares, while MSCI's broadest index of Asia-Pacific shares outside Japan was last flat, having hit a two-year top a day earlier.

Taiwanese shares also hit a record high before running into profit-taking and were last down 0.3%. Chinese blue chips edged 0.1% higher and Hong Kong's Hang Seng index lost 0.3%.

Powell is set to appear before Congress on Tuesday and Wednesday, as investors wagered a slew of soft labour market data has greatly increased the chance of a rate cut in September to about 80%.

The main economic event this week will be the U.S. consumer price report on Thursday, where headline inflation for June is expected to slow to 3.1%, from 3.3% in May, with core inflation forecast steady at 3.4%. For the remainder of 2024, markets have fully priced in a total 50 basis points of easing, equivalent to two rate cuts.

Oil prices fell after a hurricane that hit a key U.S. oil producing hub in Texas caused less damage than expected. Brent futures fell 0.3% to $85.49 a barrel, while U.S. West Texas Intermediate (WTI) crude also slipped 0.3% to $82.07.

FTSE 100 technical analysis for today, 9th July 2024

It was a modest drop off the 8222 resistance level yesterday and the bulls have fought back to bring it back above the 8200 level to start bear Tuesday. It actually looks like we may well get a rise and dip play out today, and the only major news is Fed Chair Powells testimony at 15:00.

To start with the key support is at the daily pivot 8206 and also the green 30m coral here. The bulls however will need to break above the 2h Hull MA at 8233 currently if we are to get a rise towards the next main resistance at the 8265 level.

If we do see 8265, and with R2 and the key fib here, then a short here is worth a go for a drop back down towards the 8200 level.

Support wise, below the 8200 level then 8180 remains in play and also is S1 for today which would also set up a decent double bottom with yesterday. However, slightly lower down we have the 8150 level with S2 and the key fib here, and should we test that then I would like to see a bounce here.

The daily Raff channels have levelled off as well as you can see on the daily chart, and it will be interesting to see if the bullishness from the USA starts to pull the FTSE100 up as well. Yesterday the pound rose to the 128 area, which kept a slight lid on the FTSE100 exuberance (as most companies in the FTSE100 earn in dollars, earnings, and in turn the share price, are affected).

So looking at a bit of a range for today between 8150 and 8265, which is pretty wide and we may not do that full crossing today.

However, below 8150 then the 8100 area is the bottom of the Raff channels and would probably be seen if the bears were to really go for it, while above the 8265 level then 8301 daily resistance is next up, with 8367 above that. Not expecting any of those today but do bear them in mind.

Good luck today.

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