FTSE 100 May Carve Out a Multi-Day Low on Today’s NFP
The FTSE 100 has turned into a less bearish trend as it traded above the intraday high of 5978, with price also creating a double bottom at 5876.
However, there is still some bearish bias left and we may reach 5900 if today’s U.S. NFP prints lower than the 200K expected (Bloomberg News Survey). The next resistance level is the January 6 high of 6083. On a much better than expected reading however, the NFP may form a multi-day low as risk-appetite returns to the market.
For now the trend is not strong enough for us to be able to predict with confidence what the next step for the FTSE 100 will be. Rather, I would expect price to trade sideways and then react to today’s U.S. NFP.
Looking at the FTSE 100 from a longer-term perspective, I note that the bounce happened above the December 14 low of 5859. If we get a positive close today, it may well form the beginning of a rally towards the December 29 high of 6319, while a break to the December 14 low of 5859 may instead trigger a decline to the August 2015 low of 5768.
The FTSE 100 stabilised as China opted to leave the fixing of Chinese Yuan more or less unchanged from the prior day’s fixing. This caused traders to unwind bearish positions across various assets.
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FTSE 100 | UK100
Created with Marketscope/Trading Station II; prepared by Alejandro Zambrano
--- Written by Alejandro Zambrano, Market Analyst for DailyFX.com
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