The FTSE 100 has been back and forth on Friday, as we continue to see a lot of noise coming out of the Middle East and other external pressures at this point in time.
FTSE 100
The FTSE 100 has been back and forth during the bulk of the trading session on Friday, testing the 10,500 level to find support. That's an area that I think is important not only due to the fact that it's a large round number, but it's also an area that has shown itself to be interesting to those who would buy the index, and of course, the 50-day EMA.
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The candlestick looks pretty much unchanged, and if it holds that way through the last couple of hours of trading, it shows that the market just is not ready to fall apart. That's a good sign; it could open up the FTSE 100 towards the 10,750 level.
Technical Support and Central Bank Policy
Pullbacks from here, I think, continue to see support in the same general vicinity as the 50-day EMA, which has acted as support and a bit of a trendline going back to the middle of June.
The FTSE 100 will also be heavily influenced by other global indices, and of course, interest rates in the Bank of England's interest rate policy, which at this point in time looks like it is a little tighter than many others, but there are reasons to believe that perhaps things may get a little looser going forward. There are concerns, though, about energy and inflation coming down the road from that, so it is a bit of a moving target. It's also summer, which can be quiet.
But all in all, this looks like a market where every time we drop, there are buyers out there willing to step in and start buying shares again. In fact, I don't really have an argument for shorting this market, at least not until we break all the way down below 10,000.
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