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FTSE 100 Retreats from Seven-week High


At midday, the FTSE 100 was trading 0.29% lower on the day at 7,387.0 on improved sentiment over US-China trade relations as we approach the day that trade negotiations will start.

Earlier today, United Kingdom Markit Manufacturing PMI registered at 48.3 and topped expectations of 47 in September. While, the Nationwide survey showed that house prices fell in September by 0.2%, below expectations of 0.5% as Brexit uncertainty weighs on the market.

Political risks from Washington are less in focus today, despite Democrats formally initiating impeachment proceedings against President Trump. On the Brexit front, PM Boris Johnson will present his Brexit plan to the EU in the next 24 hours.

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FTSE 100 Support and Resistance Levels

On the technical side, the FTSE 100 has started to retreat from its seven-week high reached on Friday, yet the FTSE 100 maintains positive momentum the following its bounce from its 200-day moving average on Wednesday last week (see blue line in chart below).

Downside support can be found at today’s low of 7,378, while a break below the daily low will open the way for a test of the 100-day moving average at 7,349. Below this level, the next support comes in at the lows seen on August 29th  at 7,100.

The index is facing resistance at 7,433, followed by the August 5th hight at 7,404, with a close above this level opening the door for a move to the 7,700 high from the end of July.

European indices are trading mixed today, the DAX 30 gives up 0.14% to 12,410 while the CAC 40 in Paris trading 0.21% lower at 5,666, In Milan, the FTSE MIB is 0.61% higher at 22,244.

In Wall Street, the Dow Jones futures are trading 0.28% higher at 26,977, the S&P 500 futures are 0.27% higher at 2,986 while the Nasdaq futures are 0.35% higher at 7,798 signaling a positive start for equities on the other side of the Atlantic. Investors  will focus on the ISM Manufacturing PMI which will be released later today.Download our latest quarterly market outlook for our longer-term trade ideas.

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