The FTSE outperformed European Indices on Friday as it traded 0.80% higher. The internationally exposed index found support on a sharp decline in the pound, prompted by fears of a no-deal Brexit, and positive corporate updates from its member Vodafone. This week, the BOE will hold a monetary policy meeting unlikely to deliver a change in interest rates however will garner attention as it will be the first under the new PM Johnson. Preceding the event is the FOMC meeting on Tuesday which market will look to for a rate cut as hopes of looser monetary policy buoy global equities. Today there are no major economic releases out of the UK and trade headlines will be the focus as the US and China resume trade talks this week. Meanwhile, the FTSE should find support on continued weakness in the pound.
The FTSE gained 60 points to end at 7549 on Friday whilst remaining within the familiar range. The price edged towards the upper half of the FTSE’s range as it traded above the 20-period MA at 7520. Look to the 20-period MA to provide near term direction on the day with a sustained move above 7520 required to maintain buying pressure with the next target resistance at 7570 followed by 7600. Failure to hold above 7520 should lead the FTSE lower to re-test the support zone of 7475/7470.