FTSE index surrendered early gains on Monday, as European stocks were particularly badly hit by the ongoing trade tensions between the United States and China and worries over protests in Hong Kong.
13 August 2019 | SQUARED DIRECT – The FTSE traded higher before it declined to end 0.37% lower on Monday. The latest news of heightened tensions in Hong Kong weakened global sentiment and added to concerns over trade tensions between the US and China.
Moreover, against a backdrop of slowing global growth and geopolitical tensions, The UK suffers from the political uncertainty of Brexit and its impact on the economy. Friday’s GDP data showed the economy contracted by 0.2% and will turn markets’ attention to today’s UK employment figures. Apart from the data, expect geopolitical and trade headlines to dominate sentiment.
FTSE technical analysis
The FTSE declined by 27 points to end at 7226 on Monday. The price recorded an intra-day high of 7305 before edging lower to hold below the 20-period MA.
Today look to the 20-period MA at 7245 to determine near-term direction on the FTSE, as a sustained move below this level would maintain selling pressure while a break through the support zone of 7200/7190 near the 200-day MA would signal further declines. Alternately, a move above 7245 would indicate buying pressure, while holding above 7300 would be required to target higher resistance levels.
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