FTSE 100 Trading analysis and outlook for 8th November 2019
- Two members of Bank’s Monetary Policy Committee rebel as Threadneedle Street holds Bank Rate at 0.75pc
- Bank cuts forecasts for growth in light of Boris Johnson’s deal
- Mark Carney refuses to be drawn on how revoking Article 50 would impact forecasts
- Sterling drops to two-week low as investors eye a cut in the near future
- US and China announce plans to lift tariffs in phases as they work towards a deal on trade
As a whole, the FTSE 100 advanced 0.13pc to 7,406.41, amid solid gains elsewhere across European indices. The day was packed with individual company reports, with many driving subsequent share movements.
The FTSE 250 was particularly lifted after a smorgasbord of expectation-beating updates and results from London’s mid-cap companies.
US markets rose to record highs after the US and China agreed to roll back tariffs slapped on each others’ goods to help get their trade truce over the line. Wall Street stocks climbed as the Chinese commerce ministry revealed that tariffs on goods worth hundreds of billions of dollars will be lifted in stages as progress is made on the deal.
Gao Feng, the ministry’s spokesperson, said that both sides agree phasing out the tariffs proportionally is an important condition for reaching the agreement. He added: “The trade war started with tariffs, and should end with the cancellation of tariffs.”
The S&P 500, the US benchmark index, reached a new record high of 3,095.60 points. European markets were also carried higher by cooling trade tensions with the FTSE 100 gaining as much as 0.5pc.
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
The 30min and 2 hour charts are now showing the 7407 to 7420 area as resistance again now, though we still have that gap at 7440 which was the July high, If the bulls were to go for it today then we may well see a move to this level, however there is strong resistance at the 7420 and 7430 levels as well. Quite a strong resistance zone in play here.
Gold dropped off steadily yesterday but has bounced a bit off the 1461 level which is the new bottom of the Raff channels.
The risk-on mood that permeated markets for most of the week might be easing off a bit and we may get away from the extreme greed level as that is still at 91/100. That said the bulls have momentum on their side still and the FTSE 100 is sat right on the 30min 200ema as I write this at 7380 to act as support. As such we may well see an initial rise first thing (and the reason why I have taken further profit on the short here) towards the 7420 level.
If the bears break below the 7373 level though then we should see a drop down towards the 7330 level, where we have daily support (previous resistance now support) and also the S3 level for today. There is a fib level at 7360 as well, but the bears may well drive it down quite quickly if they get going. As its Friday it will pay to be a bit more cautious as per usual, and also we may well see some profit taking after this weeks rise ahead of the weekend.
Good luck today and have a great weekend.
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