The FTSE traded 0.58% higher as market participants respond to the FED rate cut from the previous day while the BOE’s dovish stance aided the FTSE’s upside potential. The BOE expectedly left interest rates unchanged and delivered a cautious outlook that may result in a rate cut should political uncertainty in the UK persist. On trade news, the US and China are to continue their two day trade discussions from which markets are hoping some semblance of progress. Moreover, two Fed members are scheduled to speak later today and any hints on future monetary policy could be driving force on the FTSE’s price action. Trader should continue to monitor trade and Brexit developments to influence market sentiment.
The FTSE gained 42 points to end at 7356 on Thursday as the price managed to maintain the ascending trend line tracing the FTSE’s sequence of higher lows. Today, look for a sustained move above 7350 to indicate buying pressure and lead price to a test of the resistance at 7380. A break above 7380 would signal a bullish continuation and target higher levels at 7400 and 7420. Failure to hold above 7350 and maintain the trend line support would lead to a test of the support at 7300 and 7265.