The FTSE 100 rallied a bit on Friday as we continue to see stocks rally in general. Ultimately, this is a market that should go looking towards the 7190 level, but it may take quite a bit of strength to break above there. If we do, then the market is very likely to go looking towards the 7300 level. After all, the FTSE 100 is without a doubt a “risk-on index”, so it does make sense that we would see buyers on dips as well. The 7100 level has offered quite a bit of support, so I like the idea of using that as a springboard if we do pull back. Furthermore, we also have the 50-day EMA currently sitting at the 7044 handle that also could cause quite a bit of support.
To the downside, if we were to break down below that level, then the market would go looking towards the 7000 handle, which is a large, round, psychologically significant figure that a lot of people would pay close attention to. I would anticipate that there would be a lot of options barriers in that general vicinity. The market continues to see a lot of upward pressure though, so it would be a bit much to expect the market to break down below there. If it did, then we have an uptrend line that is currently somewhere close to the 6900 level, so it all comes together for plenty of buying opportunities. In fact, I do not have any interest in shorting the FTSE, but I also recognize that if one of the indices in the European Union were going to be easy to short, it might be this one, as we have so many concerns about the United Kingdom going forward.
Nonetheless, this is a market that continues to see plenty of interest, so we should see plenty of buyers coming into the market to pick up a bit of value going forward. Ultimately, this is a market that should see plenty of value hunting, as stock markets around the world all seem to look very likely to be supported by multiple central banks. The FTSE 100 is no different, and as we start to look forward to a time after the coronavirus, a lot of people will be looking for those cheap British exports.
