Stocks in London are set to pull back on Wednesday following a report the US is considering upping tariffs on Chinese products, and as investors await the latest central bank moves. The Bank of England may raise interest rates from 0.5% to 0.75% on Thursday despite Brexit gloom. In focus on Wednesday are the manufacturing PMI readings for June due from Germany, the Eurozone and the UK.
The UK Index got a boost yesterday and finally broke out from the range it has been trading in for the past few days. After the bullish move up past the 7705 it failed to cross the resistance level at 7777 as sellers stepped in. However, we are still trading above the trendline therefore more upwards momentum is expected today. The RSI looks bullish suggesting more upside potential.
Support: 7625 7575
Resistance: 7705 7777