The FTSE recorded its third consecutive gain this week as hopes of a Brexit breakthrough alongside trade optimism uplift market sentiment. While the outcome of Brexit remains uncertain, the fact that PM Johnson’s deal was approved marked a significant development and what remains is whether the EU would grant an extension to the October 31st deadline. Today, the US, Eurozone and Germany publish manufacturing PMI figures which would provide insight into the global economic outlook. The data may have a muted impact on the FTSE as markets attention is tuned to the prospect of Brexit. Thus, if there are any, geopolitical developments will bear influence on the day.
The FTSE extended gains by 48 points to end at 7260 on Wednesday. The price managed to break through the resistance at 7250 while the RSI reading drifted into bullish territory. Today, look for a break above the resistance at 7270 to target the higher resistance zone of 7290/7300. Trading below 7230 would lead the FTSE lower where the 20-period MA near 7200 is expected to provide dynamic support as the index drifts higher.
Resistance: 7270 /7300