The FTSE traded 0.72% lower on Tuesday amidst fears of escalating US-China trade tensions. Providing some relief to global markets during the day was China’s move to stabilize its currency after deliberately devaluing it against the dollar. Nonetheless, global trade uncertainty persists and markets should look to trade headlines and cautious sentiment to lead the FTSE’s direction today.
The FTSE lost 52 points to end at 7171, below the 200-day MA at 7184.The 4H and daily RSI reading indicate oversold conditions however bearish momentum remains strong as it dragged the FTSE even lower. There is potential upside to be found once the RSI reading exits the oversold territory and price manages to trade through the 7240 level to target the higher resistance at 7315. Look to the 7184 level to determine near-term direction on the day, with a sustained move below this level required to indicate selling pressure and lead the FTSE to test the lower support at 7150 followed by 7100 and 7080.