UK markets were closed for a public holiday on Monday and may see the FTSE turn higher today led by positive cues from Asian markets. Moreover, The FTSE may follow through yesterday’s gains in European Indices buoyed by the European election which saw mainstream parties garner the majority’s support. On global trade front news , The US has laid off China for the time being as it carries out trade negotiations with Japan however President Trump couldn’t not refrain from providing US-China input as he reportedly commented that he was not ready to make a trade deal with China. Traders should monitor US-China trade headlines to influence sentiment and result in news-driven price action.
The FTSE should resume trading today following its close at 7277 on Friday. The price should find resistance around the 20-period MA at 7310 which should determine near-term direction and make room for gains should it broken. Short-term upside could occur should price manage to hold above the 7270 level, however a break above 7370 would be required to bring back a bullish outlook. Alternately, a failure to sustain price action above 7270 would negate chances of testing resistance at 7310 and drive the index lower with initial support at 7240 followed by 7200.
Support: 7240/ 7200
Resistance: 7310/ 7340