- Global stock averages have stabilised over the past 1-2 days, and despite probes to new bear cycle lows, markets have NOT displayed the bearish, capitulation-type activity seen previously through March.
- This “not going down” could be viewed as “the new going up”, though we are far from indicating that any sustainable bottoms are in place.
- As we go into the European session Friday, the threat remains for a roll back lower into recent ranges today, as traders should be wary of potentially erratic, sideways consolidation activity to end the week, and maybe into early next week (depending on global developments).
- Moreover, a pop to the upside should also not be discounted.
- Here we focus on the future on the UK benchmark average, the FTSE 100, which has been assisted in the sideways theme, by the weakness in the Pound.
FTSE 100 Future day trade outlook: Erratic consolidation, but negative whilst below 5373.5
Roll to the June 20 contract: A Thursday selloff to nudge a new cycle low, but then an intraday rebound, BUT still capped at 5317.5 and whilst below here we still see downside forces from the very bearish tone throughout March through long-term supports, to keep risks lower again Friday.
- We see a downside bias for 5088 and 5056.5; a break below aims for 4979 and 4939.5, maybe 4887.
- But above 5317.5 targets 5373.5, which we would look to try to cap; above opens risk up 5445/50, 5500/04 and 5593, maybe towards 5697.5.
FTSE 100 Future intermediate-term outlook
A late February plunge below 7164 set an intermediate-term bear trend.
- Downside risks: We see an intermediate-term bear trend to aim for 4701.5 and 4500, maybe 4060.5.
- What changes this? Above 6398 shifts the intermediate-term outlook to neutral and through 6871.5 to bullish.
Daily FTSE 100 Future Chart