FTSE 100 Futures started the last day of November on the back foot, trading down 0.8%. Mining shares led the decline as Chinese manufacturing data came in weaker than expected. Traders and investors will be cautious ahead of the G20 summit where US President Donald Trump and his Chinese counterpart Xi Jinping are expecting to talk trade. In addition, Royal Mail is set to lose its place in the FTSE 100. Insurance company Hiscox is likely to take its place in the quarterly reshuffle.
In my previous FTSE 100 report, I mentioned that bear themes remain intact despite the recent trading range. Prices remain subdued below the 23.6% fib of the May to October selloff, reinforcing negative pressures. Moreover, prices have returned to the 61.8% fib of the 6,850-7,196, suggesting increased near-term problems. The index is also forming a symmetrical triangle pattern. This continuation pattern, once broken, may suggest further downside risks.
Trending setups continue to reinforce the bearish scenario as 100/50-Day EMA’s track lower. Prices have chopped around the 21-Day EMA, which has caused it to have no directional bias. The 100/50/21-Day EMA’s lie at 7,254, 7,130 and 7,041 respectively.
Momentum setups also continue their bearish arguments. The RSI rallied higher before meeting resistance from the downtrend line, which also coincided with the 50 level. It now lies at 44. The MACD looks to be converging after trending higher but remains in negative territory.
My earlier thoughts remain the same for the FTSE. A sideways trending market is the most likely situation unless significant levels are broken. This would be the break of 6,833 level.
Stock Snap – Aston Martin Still StrugglingThe above references the authors opinion and is for information purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.
Akif began his trading career from the London Academy of Trading after completing an accredited Level 5 Diploma in Professional Applied Financial Market Trading. He then went on to manage a fund at a proprietary trading firm within the City trading multiple asset classes over multiple timeframes and has recently begun writing daily reports on G10 FX, Equity markets and Commodities at the firm. Akif joined the Society of Technical Analysts in February 2018 to gain the MSTA (and CFTe) designation. He focuses on European Indices, FX and Commodities.
TA qualifications: Diploma in Professional Applied Financial Market Trading