The FTSE 100 rallied a bit on Tuesday, as we continue to see global indices in general do better. At this point the UK 100 is simply doing the same thing as many other indices.
FTSE 100
The FTSE 100 rallied quite nicely during the trading session on Tuesday as we are above the 10,500 level. We used the 50-day EMA as a bit of technical support as well, and it's been somewhat reliable since the middle of June as a bit of a trendline. That being said, I do see a lot of resistance near the 10,700 level above, and I think it will take something a little special to get above there.
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The overall attitude of the market will remain one that I think you have to be cognizant of the possibility that traders will be looking to take advantage of cheap contracts. I do believe that ultimately it goes higher. We're seeing this with most indices, not just in Great Britain—I did a video today on the DAX in Germany as well showing much of the same behavior, and the Nasdaq 100 is as well in the United States. So, in general, I think equities are just getting a bit of a boost.
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We'll have to wait and see if that continues, but London doesn't look to be any different. I like the idea of buying dips here. I do think that it is probably only a matter of time before we test the highs just shy of the 11,000 level.
But that doesn't mean it has to happen right away. And in fact, when you look at the price action going back to May, it's been positive, but it's been a real grind. It hasn't been with a lot of conviction; it's just been a slow and steady march higher. If you had bought dips, you've made money, but not necessarily rapidly, and that, until something changes fundamentally, is probably how we behave.
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