FTSE 100 live outlook prediction analysis for 13th January 2020
It was a fairly subdued day for stocks on Friday on the back of unexceptional US job and wage growth data, with markets in London ending slightly lower After an uneventful session, the FTSE 100 fell 0.14pc to 7,587.85 while the FTSE 250 dropped 0.35pc to 21,566.67.
December saw 145,000 jobs added in the US, while the consensus estimate was 166,000. The November report was revised lower to 256,000 from 266,000. The jobless rate held steady at 3.5pc, meeting forecasts. The level is a joint 50-year low. Average earnings on a yearly basis came in at 2.9pc, but traders were expecting it to stay at 3.1pc.
The S&P 500 dropped from record levels on Friday after the latest jobs report delivered mixed signals on the strength of the economy. In the Philippines, the stock exchange suspended trade because the Taal volcano to the south of the capital is belching out ash. Looking ahead, the U.S. and China are still expected to sign the first phase of their trade deal, which President Donald Trump said will take place on Wednesday.
FTSE 100 Outlook | Trading Signals | Forecast | Prediction | Analysis
The US futures have risen helped by an optimistic Asian session and as such we may well see a rise on the S&P towards the 2 hour resistance level at 3278 this morning. With the slightly bearish overtones on Friday the 2 hour charts across the board have gone bearish and are showing resistance at 7601 on the FTSE, 3278 on the S&P, 13523 on the Dax, 6935 on the ASX200. So, while its worth trying shorts at these levels, also be mindful that with sentiment being what it is at the moment that could be a bear trap from Friday and we push higher, especially if we suddenly get positive trade deal news out of the US. The Brexit date of 31st January is also looming into view.
I have mentioned 7601 for the FTSE there but I am thinking that we will get a bit of bull Monday and actually push past that, especially as we are pretty much at this level as I write this. I am looking for a rise towards the fib level at 7638 initially today, and at that point we may well see a drop down from there. I am thinking that the S&P will test the 2 hour and then drop off a bit, as we also have the 30min coral for resistance at 3277.
If the FTSE bulls were able to push past the 7638 then a rise towards the bigger picture resistance at 7681 (10 day Raff) looks possible. Having tested the bottom of this channel at 7450 on the 8th January, thanks to the Iran situation, a full crossing of this channel could well play out. So watching this level closely above the 7638 resistance.
For the bears, if they take it below 7590 to start with today then the overnight low at 7563 is likely to be tested. Below this it gets more bearish with a test of 7500 on the cards – so worth shorting any breaks of that support level.
In other news BoE’s Vlieghe has become the latest MPC member to come out in support of a potential rate cut if data does not improve.
Will we see a signed trade deal between the US and China this week? US Treasury Secretary Mnuchin stated that China’s commitments in Phase 1 deal were not changed during the lengthy translation process.
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