UK FTSE 100 (.FTSE) continue to rally, despite UK Prime Minister in intensive care
Last night UK Prime Minister Boris Johnson was admitted to intensive care after his coronavirus symptoms worsened. Foreign Secretary Dominic Raab will deputise for the Prime Minister where needed as he receives treatment. Despite this concerning news, markets have continued their rally this morning with the UK’s FTSE100 up over 3% and Germany’s Dax up 4.5%. US futures point towards a firmer open between 2 and 3%.
Global stocks soared on Monday, driven by optimism that the spread of Covid-19 in the US and other key markets may be passing through its peak. In New York, the epicenter of the US coronavirus outbreak, Governor Andrew Cuomo said on Monday that there had been two consecutive days of falling hospitalisations and intensive care admissions.
However, despite the positivity — which sent the major US stock indices more than 7% higher — some analysts are warning investors to be cautious. Matt Maley, chief market strategist at trading firm Miller Tabak, cautioned that in the decade-long bull market many firms “loaded up to the gills in terms of debt” and as they deleverage themselves “that is going to keep the economy from picking back up the way it did following the 2018 deep correction.”
Currently, economic data and warnings from industry leaders are playing second fiddle to sentiment surrounding the spread of the virus. It is worth noting that bear markets often feature so-called “bear trap” rallies. On Monday, JPMorgan CEO Jamie Dimon predicted that a “bad recession” is incoming, with US unemployment reaching as high as 14% in a severe scenario. While investors appear to be glossing over worse-than-expected unemployment numbers, corporate earnings season kicks off next Tuesday when JPMorgan, Johnson & Johnson and Wells Fargo all report their Q1 2020 (calendar) results. Company-by-company earnings data and details from firm leaders will be closely watched.
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
The projected upper bound is: 6,204.78.
The projected lower bound is: 5,133.07.
The projected closing price is: 5,668.93.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 25 white candles and 25 black candles.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 53.6975. This is not an overbought or oversold reading. The last signal was a sell 6 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 47.37. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 10 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 95. This is not a topping or bottoming area. The last signal was a buy 13 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 9 period(s) ago.
Rex Takasugi – TD Profile
FTSE 100 INDEX closed up 122.060 at 5,704.450. Volume was 57% above average (neutral) and Bollinger Bands were 8% wider than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 5,588.71 6,447.58 7,142.17
Volatility: 56 59 33
Volume: 1,476,338,048 1,260,497,280 846,662,336
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FTSE 100 INDEX is currently 20.1% below its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of .FTSE at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on .FTSE and have had this outlook for the last 50 periods. Our momentum oscillator has set a new 14-period high while the security price has not. This is a bullish divergence.
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