The FTSE 100 has fallen rather hard during the trading session on Thursday to break down below the 6600 level. Furthermore, we even fell enough to fill the gap underneath, which of course is something that you will see quite often. The 50 day EMA is sitting just below there and it should offer support as well, so I think it makes quite a bit of sense that there will be plenty of reasons for buyers to get involved. Most of the problem that we have seen during the day probably stems from the fact that the British pound was up 0.7% during the day, and therefore it tends to work against the idea of exports being cheap enough to warrant higher pricing.
All that being said, the reality is that the British economy is starting to open up a bit, and of course with a higher vaccination count than most of its peers, that should continue to see the British economy be looked at with favor. All things been equal, I think that this is a market that should see buyers jump in based upon all of the support in this general vicinity and as you can see later in the day, we did of course bounce a bit. Nonetheless, this is a market that still looks like it is probably going to have to grind a bit before shooting to the upside, but I think we revisit the highs as the market continues to see plenty of volatility and liquidity thrown at it. The size of the candlestick of course suggests quite drastic selling, but when you look at the longer-term picture it is a scenario where we are still very much in an uptrend, although the most recent action has not been as favorable. I think if you pay attention to the British pound and it does not get too far out of hand, we should continue to see the FTSE 100 rally. Keep in mind that the British pound approaching $1.40 is a pretty strong move, but from a historical standpoint, it is not overly expensive. Because of this I think that these pullbacks will continue to be looked at with a certain amount of greed, but the other thing to pay attention to is that oil markets are getting a little frothy so that may be a bit of a headwind.