FTSE 100 Ignores UK GDP Figures and Climbs

Earlier this month, the FTSE 100 was on its way to the August 2018 high of 7793 but President Trump announcing fresh tariffs sent the FTSE 100, and other global stock market indices lower.

Since that initial drop in the index, it has stabilized just above the June low of 7078, and not even the latest and negative quarterly GDP figures have managed to send the FTSE 100 lower. The market reaction to the UK GDP report is not surprising given that most FTSE 100 firms derive their profits from outside of the UK.

Going forward, the technical outlook suggests that the FTSE 100 might be able to recuperate some of its losses. The price is indeed above the June low which shifts the risk/reward ratio in the favor of the bullish traders. And the RSI 14 on the daily chart is also moving up from oversold levels.

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The next potential resistance level and a potential profit target of bullish trades is the 38.2% correction level of the latest bear leg at 7379, followed by the 50% correction level at 7446, which happens to also be the July 25 low, and could prove to be a difficult level for the markets to overcome.Download our latest quarterly market outlook for our longer-term trade ideas.

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