FTSE Surpasses 7000, Rising 40% From 2020 Low

FTSE 100 Evaluation:

• The FTSE 100 index surpasses 7000 landmark for the primary time since Feb 2020
• Ocado Group is powerful out of the gate after £10m funding in Oxbotica
• IG Consumer Sentiment nearing 50/50 cut up offering combined buying and selling atmosphere

FTSE 100 Continues Bullish Run above ‘milestone’ 7000 mark

The FTSE 100 index breached 7000 on Friday with UK banking shares Natwest and Barclays amongst a number of the largest movers. In early UK buying and selling this morning, it’s Ocado Group that leads the way in which after the web supply service invested £10m in Oxbotica to develop autonomous autos for future deliveries. Demand for on-line purchases and doorstep deliveries have will increase drastically throughout lockdown and are properly positioned to thrive even after restrictions ease.

FTSE 100 Extends into Potential Zone of Resistance

Whereas the FTSE nonetheless lags US tech-heavy indices, it has skilled a relatively constant bull run of late. Recovering to the 7000 mark after buying and selling beneath 5000 simply over a yr in the past reveals how client confidence has picked up – albeit with huge financial and authorities assist.

The weekly chart reveals how worth has moved above the current excessive and the 7000 mark however might run right into a relatively important zone of resistance from simply over 7000 to 7150. The 7150 stage performed a big function all through 2019 as a long run stage of assist.

FTSE 100 Weekly Chart

Chart ready by Richard Snow, IG

FTSE 100 Every day Chart Displaying Indicators of Potential Bullish Fatigue

The every day chart takes a more in-depth take a look at the degrees most related to the UK index. Worth motion might commerce throughout the beforehand talked about vary of 7000-7150. A break and maintain above 7150 will most definitely appeal to the eye of bulls as such a transfer could also be indicative of additional upside to come back.

Nevertheless, proper now, there look like indicators that the current bull run could also be operating out of momentum. Whereas it’s nonetheless early, the 700-7150 band poses a menace to the present bull run whereas the RSI index positioned present ranges into overbought territory. Due to this fact, we may see a retracement (cooling off interval) again beneath 6960 and even again in direction of the ascending trendline.

FTSE 100 Every day Chart

Chart ready by Richard Snow, IG

IG Consumer Sentiment Nearing 50/50 Cut up – Offering Blended Buying and selling Setting

• FTSE 100: Retail dealer knowledge reveals 52.94% of merchants are net-long with the ratio of merchants lengthy to quick at 1.12 to 1.
• We usually take a contrarian view to crowd sentiment, and the actual fact merchants are net-long suggests FTSE 100 costs might proceed to fall.

• The variety of merchants net-long is unchanged than yesterday and 12.94% decrease from final week, whereas the variety of merchants net-short is unchanged than yesterday and eight.23% larger from final week.
• The mix of present sentiment and current adjustments offers us an additional combined FTSE 100 buying and selling bias.

— Written by Richard Snow for DailyFX.com

Contact and observe Richard on Twitter: @RichardSnowFX