City enjoying ‘Boris bounce’ and US-China talks as UK (.FTSE) 100 soars
The FTSE 100 soared more than 2% on Monday as investors continued to enjoy the election result and took comfort in the US and China taking the first tentative steps towards a new trade deal.
By close of play, it was up 166 points at 7519 – hitting a four-month high in the process – as the mainly international-focused businesses on the index enjoyed the optimism from politicians that the trade war is de-escalating.
Just three of the 100 listed companies – Pearson, M&G and Land Securities – saw shares fall on Monday.
Choosing to ignore the more eyebrow-raising elements of the US-China ‘phase one’ trade agreement – a healthy dose of scepticism has greeted the deal – the markets donned their Santa hats and celebrated their early Christmas present Connor Campbell, SpreadEx
A pound was worth 1.333 dollars – flat on the day, whilst the pound dropped slightly against the euro by 0.18% to 1.196.
Financial analyst Connor Campbell, of SpreadEx, explained: “Choosing to ignore the more eyebrow-raising elements of the US-China ‘phase one’ trade agreement – a healthy dose of scepticism has greeted the deal – the markets donned their Santa hats and celebrated their early Christmas present.
“The gains only ramped up as the session went on. The FTSE led the charge, boosted by a mix of the trade relief and residual goodwill related to last Friday’s election result.”
He also pointed out that weaker-than-expected economic data from the UK was largely ignored, as traders focused on the positives elsewhere.
Markets in Europe also enjoyed the US-China deal, with the CAC 40 in Paris ending up 1.2%, while the DAX 30 in Frankfurt closed up 0.9%.
On the FTSE 250, which is primarily made up of UK-focused companies, also continued its stellar rise since last Friday’s election result.
Having hit an all-time high on Friday, it beat that record, closing up 412 points, or 1.9%, at 21,920.69, following 4% rises last week.
Overall, the bias in prices is: Upwards.
The projected upper bound is: 7,682.96.
The projected lower bound is: 7,367.99.
The projected closing price is: 7,525.47.
A big white candle occurred. This is generally considered bullish, as prices closed significantly higher than they opened. If the candle appears when prices are “low,” it may be the first sign of a bottom. If it occurs when prices are rebounding off of a support area (e.g., a moving average, trendline, or retracement level), the long white candle adds credibility to the support. Similarly, if the candle appears during a breakout above a resistance area, the long white candle adds credibility to the breakout.
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 29 white candles and 21 black candles for a net of 8 white candles.
Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 83.6568. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 5 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 65.88. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 92 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 141.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a buy 6 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 1 period(s) ago.
Rex Takasugi – TD Profile
FTSE 100 INDEX closed up 165.610 at 7,519.050. Volume was 39% above average (neutral) and Bollinger Bands were 11% wider than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 7,253.46 7,286.22 7,322.78
Volatility: 21 14 14
Volume: 850,071,488 773,492,864 733,747,008
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FTSE 100 INDEX is currently 2.7% above its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect volume flowing into and out of .FTSE at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on .FTSE and have had this outlook for the last 9 periods.
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