What's inside:

• The FTSE continues to hold trend-line support
• A drop below won't shun bulls until a decline below horizontal support
• Global risk appetite is somewhat supportive

The FTSE 100 continues to hold onto trend-line support rising up from around the ‘Brexit’ vote, a positive development overall, and one which we will continue to use as a guide in the days to come. A drop below the trend-line doesn’t mean the trend is over, but it would suggest it has weakened at the least. A decline below peaks extending back to the middle of August would be the cause for pause on longs.

Generally speaking, global risk appetite has been supportive for stocks. We certainly don't have a rip-roaring, snatch up all-things-risk environment, but general sentiment is strong enough to keep stocks buoyed. Last night the Nikkei pushed to its best levels since May. In Europe, the DAX and CAC 40 are both nearing multi-week highs, while the U.S. has become the laggard, with a posturing somewhere in the middle of its recent range, but holding up.

Also, keep in mind the weak pound is helping keep a bid in the FTSE 100 given its level of multi-national exposure. The current 21-day correlation stands at -70%, but has strengthened in the past week or so from a near -90% reading. It's not a relationship we are looking at with a microscope, but one worth keeping tabs on.

For now, as long as the FTSE continues to trade above the trend-line or the prior peaks turned support and 10/13 low at 6930, then our bias is neutral to higher. No material resistance to speak of will arrive until around the record highs set on Oct 11 at 7129.7. If global stocks turn materially weaker and/or the poundturns sharply higher, then expect support levels to come under siege.

FTSE 100: Daily

Welcome to my products: 

https://www.mql5.com/en/users/soubra2003/seller