The FTSE index surged 1.9% on Friday due to China’s offer to increase US imports which stirred hopes of a Sino-US trade resolution and led to positive sentiment on this crucial issue. However, today’s GDP figures from China point to weak economic growth, potentially holding back the FTSE from making continuous gains. Meanwhile in the UK, May is set to propose an altered Brexit plan to the Parliament after facing rejection last week on her initial deal, leaving the prospect of Brexit perpetually unclear and reinforcing fears of slowing global growth.
The FTSE index moved past resistance at 6940 and is sitting below resistance zone of 6980/7000. Bulls would need to push price action past this zone to validate buying pressure. A failure to sustain above the 200-period MA , could push price action towards the 20-period MA at 6880 .
Support: 6880/ 6790
Resistance: 7000/ 7120