FTSE 100 Ends Stalemate
- FTSE 100 rises sharply following gains in the Financial Sector.
- The short-term trend is bullish above yesterday’s low of 6108.5, and the next nearest support level could be the May 12 high of 6195.
- The nearest resistance level is the May figure of 6285.
The FTSE 100 (CFD: UK100) had more or less reached the May 3 high of 6285 this morning, a level we have been highlighting over the last few days as the first important resistance level above the May 12 high of 6195. The short-term trend is now bullish above yesterday’s low of 6108.5, and the trend is bullish above this level given that it is a higher low in relation to the May 19 low of 6051. Price has also been creating higher highs since May 19, with today’s high being the most recent one.
As the short-term trend is bullish above yesterday’s low of 6108.5, the price should be creating higher highs and higher lows according to the rules of classic technical analysis. The May 12 high, the level that had kept price capped for more than two weeks, may now have turned into support while the May 3 figure is the closest resistance level followed by the April 28 high of 6325 and April 27 high of 6342.
On the price trading below yesterday’s low of 6108.5, the next support level will be the May 19 low of 6051. Yesterday’s strong rise to the FTSE was primarily attributed to the Financials sector and it is here that the median share rose by 2.88%. The Consumer services sector followed with a median share return of 1.51%.
FTSE 100 | CFD: UK100
Created with Marketscope/Trading Station II; prepared by Alejandro Zambrano
There is no U.K. data on deck this morning, but the German IFO Business Climate index published earlier rose to 107.7 from 106.6, and beat the 106.8 expected as per a Bloomberg News survey. The IFO Expectation index rose to 101.6 from 100.4. The FTSE 100 rose slightly following the news, but given the strong gains over the last 24 hours, traders appear to be reluctant to lift the index to higher levels.
The German IFO Business Climate index has been rising over the last two months and indicates slightly higher German economic growth from the lows that were seen in February.
--- Written by Alejandro Zambrano, Market Analyst for DailyFX.com
Contact and follow Alejandro on Twitter: @AlexFX00
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.