The FTSE outperformed European Indices as it surged 1.1% on Tuesday aided by a weaker pound due to fears over Brexit’s prolonged outcome. Given parliament’s failure to reach consensus on alternative paths to Brexit, PM Theresa May is seeking to ensure avoidance of a no-deal withdrawal from the EU, which may be the only scenario over which the parliament can find unanimity. Thus, Apart from Brexit developments, look to US China trade headlines to influence sentiment and price action on the FTSE.
The FTSE index managed to break through resistance zone of 7350/7270 before settling at 7391 on Tuesday. Bullish momentum continues to build up and price has room to move higher towards resistance at 7450/7470 should price sustain above yesterday’s close at 7391 with near-term support found at 7350. Moreover, the RSI has entered the overbought region and has yet to exit to exhibit a short-term downside in price action while the index remains in a bullish phase.
Support: 7290/ 7260
Resistance: 7370/ 7450