The FTSE rose by 0.59% on Wednesday as risk appetite improved on hopes of averting a no deal Brexit. The UK parliament introduced a bill to extend the Brexit deadline and avoid a no-deal scenario which has yet to be passed. While this improves the overall sentiment, it does not reduce but add to the uncertainty of Brexit developments. In terms of data, UK services PMI came below the estimated decline at 50.6 as the economic continues to suffer from political turmoil. On the global trade front, news that US and China agreed to meet in October should uplift trade sentiment even though there have been no fundamental changes. The positive environment should aid the FTSE, and traders should continue monitoring trade and Brexit developments to determine direction.
The FTSE added 43 points to end at 7311 on Wednesday. The price managed to hold above the support at 7235 and reach an intraday high of 7335. Today, Look for a sustained move above the resistance at 7315 to target resistance at 7345 near yesterday’s high. A break above that level would lead price towards resistance at 7380 near the 50-day MA. Alternately, Failure to trade and hold above 7315 would lead price towards the 7280 level followed by 7235.