The FTSE continued its streak of losses this week as it declined by 0.61% on Wednesday. As optimism over a Brexit deal rises , so does the pound which in turn weighed on the FTSE and limits any upside potential. The EU summit begins today and while market participants were hoping that the EU and the UK would agree on Brexit deal, the UK government slashed these hopes as they have yet to approve of PM Johnson’s unconvincing proposed deal. Today the UK publishes retail sales data which may have a muted impact as market attention is tuned to Brexit headlines.
The FTSE lost 43 points to close at 7167 on Wednesday. Since reaching the high at 7250 on Friday, the price has continued to drift lower and found support at 7150 in yesterday’s session. Today, Look for a sustained move below 7170 to maintain the bears’ control while a break below 7150 would target the lower level at 7130 which maintains the sequence of higher lows on the FTSE. On the other hand, holding above 7150 would confirm the formation of a higher low while trading above the 20-period MA at 7195 would be required to indicate buying pressure and target the higher levels at 7220 and 7240.
Resistance: 7195 /7220