The FTSE traded 0.56% higher on Tuesday as sterling weakness alongside better than expected corporate earnings out of Europe provided support. In the UK, Boris Johnson was appointed the new PM which weighed on the pound due to concerns over Britain withdrawing from the EU without a deal. Meanwhile the IMF downgraded its global growth forecast citing Brexit and global trade uncertainty. Today’s manufacturing PMI figures out of the US and Eurozone should bring further insight into the global economic outlook and potentially boost expectations of looser monetary policy from global central banks. Continued weakness in the pound should help keep the FTSE afloat while today’s economic data is expected to influence price action alongside corporate earnings.
The FTSE added 41 points to end at 7556 on Tuesday. The price traded and held above the 20-period MA to surpass the resistance at 7545 and reach an intraday high of 7598 that beats last week’s high. Look for a sustained move above 7545 to indicate buying pressure with a sustained move above 7590 required to restore the bullish outlook and drive the FTSE’s towards resistance at 7620. Failure to trade and hold above 7590 should lead the FTSE lower with a decline below the 20-period MA required to target the lower support at 7490.