FTSE 100 index drops below 7575 as Shell share price slumps


Shell shares price are down 5% at the time of writing after the firm reported a 25% drop in half-year profits. This drop has knocked a few points off the FTSE 100, despite gains for smaller firms.

2 August 2019 | SQUARED DIRECT – The FTSE ended virtually flat on Thursday as disappointing earnings from Shell were offset by positive corporate updates from the FTSE’s members. In terms of data, the UK Manufacturing PMI figure held steady in contraction territory and weighed on the pound.

On central bank news, the BOE expectedly left rates steady however lowered its outlook for economic growth. Moreover, on trade news, President Trump announced plans to impose new tariffs on China should trade negotiations fail to progress. The news should weigh on global markets as trade uncertainty turns sentiment weak and cautious.

FTSE technical analysis

The FTSE ended 2 points lower at 7584 on Thursday. The index dropped below the 7575 level and found support at 7535 before turning back up. The 20-period MA near 7586 should determine the near-term direction for the day.

A sustained move below 7586 would indicate selling pressure and lead the FTSE back down to the crucial support zone of 7545/7535 coinciding with the 20-day MA and separating the index from further declines. Alternately holding above the 20-period MA coupled with a move above 7600 should lead the FTSE towards the higher resistance at 7620 and 7640.

Support: 7545/7510
Resistance: 7620/7645

Chart (H4)

Disclaimer

Trading in Forex and Contracts for Difference (CFDs), which are leveraged products, is highly speculative and involves a high level of risk. Therefore, Forex and CFDs may not be suitable for all investors because it is possible to lose all invested capital. Only invest with money you can afford to lose. Before deciding to trade, you need to ensure that you understand the risks involved. Seek independent advice if necessary. Please refer to our Risk Disclaimer.

Share Your Opinion, Write a Comment