The FTSE 100 went sideways during the session on Thursday, as we continue to find support near the 7400 level. I think that the market is trying to build up enough momentum to continue to go higher, and the 24-exponential moving average looks to be very supportive. I think if we can stay above the 7400 level, the buyers will be enticed by this market, as it should then go looking for the 7450 handle, and then eventually the 7500 level. If we break down below the 7380 handle, then I’m willing to start selling again, as we would reenter the previous consolidation area.
In the meantime, I believe that the market will continue to be volatile but I also believe that the breakout above the previous consolidation area is a very strong sign, and I think that the bottom is trying to form some type of bottom. That bottom could be the beginning of a trend change to the upside again, and I think that it makes quite a bit of sense that we would go to the 7500-level given a choice.
GBP/USD
There is a bit of a “knock on effect” that the GBP/USD pair has an influence in the FTSE 100 as it is so heavily influenced by the export market coming out of the United Kingdom. This of course makes quite a bit of sense, as cheaper British exports of course helps companies in their earnings. I believe that if the GBP/USD pair stays in the same relatively general range that we have been stuck in for several weeks, I think that this market has an opportunity to rally, but it’s not going to be easy as we have a lot of negotiations between London and Brussels ahead of us.
FTSE 100 Video 14.7.17
This article was originally posted on FX Empire