The FTSE made a modest decline of 0.19% on Tuesday as the pound was lifted due to legislative moves by the UK parliament in attempt prevent a no deal Brexit led by PM Johnson. While this may be registered as a positive, it adds to the uncertainty as further votes will be held in request of a Brexit delay today. Should this request pass, we should see a general election on October 31st. Separately on economic data, UK construction PMI declined to 45 and today’s release of services PMI figure is expected to show a decline as well. Traders should mainly look to Brexit and US-China trade developments to impact the FTSE as they remain key drivers of price action.
The FTSE lost 13 points to end at 7268. The price retreated from its high at 7315 and traded below the 7280 level to meet the support near the 7235 level. Trading below 7235 would target the support zone bounded by the 200-day MA and 20-day MA at 7200 and 7180 respectively which separates the FTSE from further weakness. The price would have to break and hold above the 7315 level to indicate further gains towards the 7345 level followed by 7380 near the 50-day MA.