Global Indices have shown quite a bit of tension the past few trading days and selling reached a fevered pitch across Europe this morning and this was mirrored on the FTSE MIB when it opened for trading.
The Milan Index, like all of its contemporaries, has performed very well over the past few months. However, global market participants have grown nervous over the past few days as news – often rumors – is expressed economic conditions globally will continue to come into question the next half year. In other words, some financial institutions may be worried about revenues within the corporations they are investing via global indices.
The FTSE MIB is now trading near important lows and a support level of 19100.00. Selling pressure has been clear on the other major European exchanges via their indices today. And early calls from the US via the S&P are not rosy either.
If you were lucky enough to have been selling the FTSE MIB with a short position going into this morning’s trading you are likely smiling and have cashed out of a winning position. But if you are looking to establish a position now in the marketplace the question is what to do after such a steep sell-off has already occurred?
The past three months of trading for the FTSE MIB has produced solid gains. Short term traders, however, are not likely interested in the notion the Milan Index has gained and are asking what is next. Sentiment has proven to be weak this morning and the US markets on Wall Street are showing signs of coming duress for today. Meaning that if losses continue to mount in New York today and trading proves to be bad for the US Indices, trading may continue to be negative on global exchanges the remainder of the day and tomorrow before going into the weekend.
Traders who like short term trends and rely on sentiment generated via the results of global indices should suspect a selloff of stocks will continue today and tomorrow. Resistance for the FTSE MIB appears to be 19300.00 after the steep drop this morning. Support proved itself at 19100.00 early today, but it looks like it might be retested if global markets continue to produce nervousness.
FTSE MIB Short Term Outlook:
Current Resistance: 19300.00
Current Support: 19100.00
High Target: 19400.00
Low Target: 18900.00