Positive close on the FTSE 100 yesterday as oil prices edged higher, while easing worries over Brexit and the Italian budget shed some positive sentiment onto the market. Positive U.S figures were short-lived as Chairman Powell's comment on inflation triggered a drop in Treasury yields, hurting financial stocks as major equity markets closed in the red. Recent rise in political tensions are expected to weigh down on the index today, as President Trump accuses China of intending to interfere with the upcoming U.S congressional elections and threatens Canada with upcoming levies. In economic news, BoE MPC Member Haldane and BoE Governor Carney will be speaking at 11:45 GMT and 14:00 GMT, respectively.
The FTSE has been consolidating around our 7502.2 resistance level for the past couple of days, edging higher while price and momentum indicators are diverging. Divergence pattern on the 4H chart between price and RSI is confirmed on a close below 7478.1 with a target price of 7442.6 (i.e: one point above our support level). Further downside momentum confirmation with the 20 period SMA crossing the 50 period SMA from above.
Support: 7441.4 7419.6
Resistance: 7502.2 7528.1 7551.4