News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
GBP/USD
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • Greed is a natural human emotion that affects individuals to varying degrees. Unfortunately, when viewed in the context of trading, greed has proven to be a hindrance more often than it has assisted traders. Learn how to control greed in trading here: https://t.co/kODPAfs2Iz https://t.co/6dAqxsVfxJ
  • The results of this weekend’s German Federal Election will likely dominate Euro sentiment at the start of the week ahead but after a possible EUR/USD bounce they will have little long-term impact. Get your weekly $EUR forecast from @MartinSEssex here: https://t.co/Xu3ZT7EtrW https://t.co/5VHKn52MaA
  • The Consumer Price Index, better known by the acronym CPI, is an important economic indicator released on a regular basis by major economies to give a timely glimpse into current growth and inflation levels. Learn how to better understand CPI here: https://t.co/nAa0fHq4Np https://t.co/mf9rsmIvaW
  • A currency carry trade involves borrowing a low-yielding currency in order to buy a higher yielding currency in an attempt to profit from the interest rate differential. Find out if the carry trade suits your trading style here: https://t.co/7t4BzmLg8w https://t.co/mYWO0Eta0P
  • Sterling continues to contract into trend extremes and the focus is on a pending breakout in the weeks ahead. Get your weekly $GBP technical forecast from @MBForex here: https://t.co/ZvEMQuFjSs https://t.co/rMmq9cehnY
  • Japanese candlesticks are a popular charting technique used by many traders, and the shooting star candle is no exception. Learn about the shooting star candlestick and how to trade it here: https://t.co/mfwJ0sZLTs https://t.co/tm4k3IVzHr
  • Do you know how to properly Identify a double top formation? Double tops can enhance technical analysis when trading both forex or stocks, making the pattern highly versatile in nature. Learn more about the double top formation here: https://t.co/t9FlspUVZz https://t.co/FFMy5O9YoY
  • It’s important for traders to be familiar with FX spreads as they are the primary cost of trading currencies. Understand a pair's spread here: https://t.co/zEEUHZBx7g https://t.co/jZHcyAZ5SU
  • Further your forex knowledge and gain insights from our expert analysts on EUR with our free guide, available today: https://t.co/XtydfV5wS6 https://t.co/Iw9haaHAnn
  • The Federal Reserve System (the Fed) was founded in 1913 by the United States Congress. The Fed’s actions and policies have a major impact on currency value, affecting many trades involving the US Dollar. Learn more about the Fed here: https://t.co/ADSC4sr63f https://t.co/raO3gCGqQ6
FTSE 100 Remains Bearish Despite Today’s Correction

FTSE 100 Remains Bearish Despite Today’s Correction

Alejandro Zambrano, Market Analyst

Talking Points

  • FTSE 100 is short-term oversold, but bearish below last week’s high of 6016; traders will most likely use a bounce to short
  • Last week’s price action opens for a decline to the November 2012 low of 5596.5

The FTSE 100 (as other global stock markets) is correcting some of last week’s losses and is expected to be volatile given the bearish market trend. The index (FXCM: UK100) is up by 1% at the time of writing.

Short-term Valuation: Oversold

Our short-term valuation model based on the last six months of the Bloomberg commodity index suggests the FTSE 100 should be 1.7% higher (5950), while using the DAX as the explanatory variable suggests that the FTSE 100 should be trading 2% higher (5970). This discount may fully correct, but it’s not my main scenario, rather I see a partial correction as the FTSE 100 only reaches the 5870 to 5900 range. Traders will in this range be tempted to short, given that the overall trend is bearish below last week’s high of 6016. The next level of support and profit target for bearish traders is most likely the psychological level of 5700. Near this level we also find the S1 (support 1) of the weekly Pivot point indicator.

The developments across commodities complex, the soft manufacturing sector of the U.S. and the volatile Chinese Yuan and stock market are expected to keep weighing on the FTSE 100.

FTSE 100 | FXCM: UK 100 | 1 Hour Time Frame

Please add a description for the image.

Created with Marketscope/Trading Station II; prepared by Alejandro Zambrano

Longer-Term Outlook: We May Reach The November 2012 Low of 5596.5

The FTSE 100 breached some significant levels last week. Firstly, on the weekly-time-frame it closed well below the support of September and December at 5869. Secondly, it traded below its August low of 5789, which opens the door for a decline to the November 2012 low of 5596.5. This level is also pointed out as support (and profit target for bearish traders) by the monthly Pivot point indicator. The weekly chart will be bearish as long as we trade below the December 29 (this level may change if a new lower high is created in the weeks ahead).

Don’t Get Left Behind, Learn What FXCM’s Most Successful Traders Do on a Consistent Basis, sign up for our free guide here.

FTSE 100 | FXCM: UK 100 | Weekly Time Frame

Please add a description for the image.

Created with Marketscope/Trading Station II; prepared by Alejandro Zambrano

--- Written by Alejandro Zambrano, Market Analyst for DailyFX.com

Contact and follow Alejandro on Twitter: @AlexFX00

Struggling with Trading? Join a London Seminar

Get Alejandro’s daily market update in your inbox, please fill out this form

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES