FTSE 100 falls during Tuesday session, testing vital support levelThe FTSE 100 fell significantly during the trading session on Tuesday, reaching down towards the 7000 handle during the day. The market continues to be very noisy, but I think that the 7000 level will continue to attract a lot of attention in both directions.
The FTSE 100 fell significantly during the trading session on Tuesday, reaching down towards the 7000 handle. The 7000 handle of course is a psychologically important figure, so if we break down below there, I think we could unwind towards the 6950 level, but on the other hand I think we could also turn around and rally towards the 7100 level. This is a market that I think will continue to be very noisy, as there are a lot of headlines that are possible when it comes to the negotiations between the United Kingdom and the European Union.
The market should continue to be very noisy in general, so keep this in mind when you place trays. I would be cautious and use small positions as the volatility could be very dangerous. However, if we made a fresh, new high, meaning that we clear the 7100 level, then I would add to this market and go looking towards the 7250 level. If we were to break down below the 7000 handle, the 6900-level underneath could be a target, but we would need the momentum to break below the 6950 level. Either way, I like buying dips in this market longer term, but certainly it’s going to be a very dangerous place to be, so that’s why I’m advocating a small position first so that we can then add once things are proven to be correct. This way, you can ride out a lot of volatility.