The FTSE 100 rallied a bit during the day on Tuesday, reaching towards the 7565 handle. The market did pull back though, so looks very likely that we would find buyers underneath, an area that has been previous resistance. I think that eventually the markets will find buyers underneath, but volatility will be an issue as we are reaching towards the holidays. I think that given enough time, the market should continue to find issues with any selling pressure hanging on. I think that the lack of liquidity could be an issue, but quite frankly it will be a short-term phenomenon, and gone by the time we get through the holidays. This could offer a nice buying opportunity for those who are value hunters, as the FTSE 100 has been in a very strong uptrend. I believe there is a “floor” at the 7400-level underneath, keeping the market bullish.
Longer-term, I anticipate that we will break above the 7600 level, and then go looking towards the 7800 level after that. The markets continue to be very bullish in my estimation, but with the volatility you may wish to try and build your position slowly. Market participants continue to be a bit skittish as the negotiations between London and Brussels continue, but at the end of the day I think that the FTSE 100 will be seen as value due to the historically cheap British pound. Longer-term, I anticipate 8000 will be tested sometime in the spring of 2018.
FTSE 100 Video 20.12.17
This article was originally posted on FX Empire