Bad news is good news
Today’s reaction to weak UK July preliminary PMI figures (highlighting the economy at weakest since 2009) was the classic “bad news is good news” trade. Weak data pushed up prospects of BOE acting (rate cut/QE) in July. Thus, Pound weakened and FTSE spiked to a high of 6730 levels.
Technicals – Bulls need a daily closing above 6744
- Despite sharp recovery in FTSE100 from daily lows of 6663 to 6730, prices fail to see a break above symmetrical triangle resistance on hourly, while the continues to form lower highs.
- The price action suggests we could break lower from this week’s consolidation pattern.
- Only a day end closing today or next week above 6744 would suggest continuation of a rally from post Brexit low and open doors for 6800+ levels.
Check out Tim Young, Trader at Ayondo who joined us on today’s Finance show to discuss his views on FTSE100 – Link - https://www.youtube.com/watch?v=cOVKrWHSVmg