The FTSE 100 index is tilting downwards in the futures market as traders brace for key earnings from the UK and the US. The index is trading at £6,970, which is slightly below last week’s high of £7,035.
FTSE 100 news: The FTSE index rallied to above £7,000 for the first time on record. This happened as investors remained optimistic about earnings and the recovery of the UK economy. The index also rallied as the market reacted to the positive earnings from top American companies like Goldman Sachs and JP Morgan.
This week, focus will be on earnings as more companies publish their results. On Tuesday, Avast, the online security company, will publish its trading announcement. It will be followed by top commodity companies like BHP, Antofagasta, and Rio Tinto that will publish on Wednesday.
On Thursday, companies like Anglo American, Rentokil, and Taylor Wimpey will deliver their results. The Taylor Wimpey results will be important because they will show the health of the UK housing industry. The mining giants, on the other hand, will show how the dynamics of commodities has impacted their businesses.
FTSE 100 technical forecast
The four-hour chart shows that the FTSE 100 index has been in a strong upward trend in the past few months. Recently, the index moved above £6,960, which was the previous YTD high. It has also moved above the 25-day and 15-day exponential moving averages (EMA) while the Relative Strength Index (RSI) is still above the overbought level of 70.
Therefore, in my view, I suspect that the index will continue soaring as bulls attempt to test the next resistance at £7,100, which is 1% above the current price. On the flip side, a drop below £6,960 will invalidate this trend.