Wednesday, September 18, 2019

FTSE100

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Fundamental Highlights

The FTSE ended virtually flat on Tuesday as market participants await the FOMC meeting later today to determine direction. Risk appetite should remain subdued unless the FOMC delivers a rate cut and more importantly hints at future monetary policy easing. Moreover, news report that US-China deputy level talks are to be held this week and Saudi plans to restore oil production by the end of the month. While this is good news, there are no fundamental changes to support higher moves across global markets. Meanwhile in the UK, inflation data will be in focus today as the British economy suffers from the prolonged uncertainty over Brexit. Should the data provide support for the pound, we should see limited upside potential on the FTSE. Traders should continue monitoring trade and geopolitical headlines as they dominate market sentiment.

Technical Analysis

The FTSE ended barely changed at 7320 on Tuesday. The price continued to retreat from the recorded high at 7380 last week as it dipped below the 7300 support level and should see further weakness should price hold below the 20-period MA in today’s session. Failure to trade and hold above the 7300 level should lead price towards the lower support at 7265. A break below 7200 would be required to signal a bearish phase as it would negate the FTSE’s sequence of higher lows. On the other hand, a sustained move above the 20-period MA would maintain buying pressure while a break above 7380 is required to signal a bullish continuation.

Support: 7300/7265
Resistance: 7350/7380

Chart (H4)
FTSE100