The FTSE followed global markets sharply lower on Thursday as concerns over the protracted US-China trade war rise amidst lack of progress. In the UK, Brexit uncertainty continue to weigh as PM Theresa May faces challenged to her leadership and her new Brexit proposal which is expected to be rejected by the UK parliament. Adding to selling pressure was Manufacturing PMI figures out of Germany and the Eurozone which point to contraction and highlight the region’s economic weakness. Today the UK publishes retail sales data however US-China trade headlines will remain the dominant factor in determining market sentiment and overall direction.
The FTSE posted a loss of 1.41% to end at 7231 on Thursday. After several attempts to push above the resistance at 7370, price rejected the level and opened room for downside price action. Look for a sustained move below 7300 to limit upside price action and maintain selling pressure. Meanwhile a decline below 7200 would lead to support level 7180 followed by major support at 7140.
Support: 7200/ 7180
Resistance: 7270/ 7300