FTSE 100 rallies to open the week

FTSE 100 traders were very bullish during the day on Monday, breaking out above resistance at the 7550 handle. The 7600 level above should offer a bit of a target, and perhaps short-term resistance, but I think ultimately we should continue to go much higher. I believe that the 7500-level underneath is going to be a bit of a “floor” in the market, and I think that it’s not until we break down below there that I would be concerned about the uptrend. If we broke down below the 7500 level, I think it would be an intermediate pullback, but that seems to be very unlikely after the action that we have seen during the day on Monday, as it has been very bullish. Longer-term, I believe that this market goes to the 7750 handle, and then eventually the 8000 level.

The market changes its overall attitude if we break down below the 7500 level, perhaps unwinding to the 7350 level. That’s an area that has been massively supportive in the past, as well as resistance. Market participants continue to look at this as value if we pull back, which is the occasional opportunity that markets present themselves occasionally. I think that longer-term we should continue to be value hunters and that the overall attitude of traders continues to look at this as a market that will benefit from a looser monetary policy out of the Bank of England, which generally helps exports.

FTSE 100 Video 08.05.18