FTSE 100 rallies slightly during the Wednesday session only to turn around

The FTSE 100 initially tried to rally on Wednesday but found the 7560 level would be a bit too far to continue going higher. By doing so, we have rolled over a bit and it looks like we are going to go looking towards the 7500 level for support. If we broke down below the 7500 level, the market probably drops down to the 7440 handle, an area that has been resistance in the past. The market will more than likely find buyers in that area, but it could be a rocky move down to that area. It is still in an uptrend, so I don’t think that the market should be sold, and that pullbacks will more than likely be buying opportunities, based upon value hunting. It’s not until we break down below the 7400 level that I would be concerned, and with the falling British pound it is going to help exports, which typically is good for stocks.

Ultimately, I do believe that the FTSE 100 is a bit undervalued, and therefore it’s likely that the market will continue to go higher given enough time. I would add slowly on top of a core position, as it gives us an opportunity to take advantage of what has been a very strong uptrend for quite some time. In general, the FTSE 100 should follow many of the other indices that we analyze here at FX Empire, as risk appetite tends to be highly correlated.

FTSE 100 Video 03.05.18