Stock averages form bases, aim higher (FTSE 100 focus)

Intermediate
  • Global share indices rebounded further Tuesday, with the US Congress apparently in agreement on the $2 trillion economic relief bill
  • Global stock averages have overcome through resistance levels, to form bases and signal a more positive outlook in the very short-term.
  • This does NOT end the bigger bear market theme, but the threat has switched to further gains and stability in the near term, maybe into the end of Q1.
  • Here we focus on the future on the UK benchmark average, the FTSE 100.

FTSE 100 Future day trade outlook: Positive recovery theme

A strong advance Tuesday through various resistances, but notably 5373.5, to secure a small base having built on Monday’s rebound from a new bear move low at 4733 (to close the opening gap lower at 4952-80.5), to switch the risk higher Wednesday.

·       We see an upside bias for 5416.5, then 5466; a break above aims for 5523 and 5581, maybe towards 5639 and 5697.5.

·       But below 5316.5 targets 5211.5, which we would look to try to hold. Below targets 5156.5, 5061 and 5011.

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

FTSE 100 chart

Editor in chief

Steve Miley has 29 years of financial market experience and as a seasoned expert now has many responsibilities. He is the founder, Director and Primary Analyst at The Market Chartist, the Editor-in...continued

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