- A break to the January 29 high of 6129 may open the door for a rally to the December 12 high of 6322.
- A breach to the February 24 low of 5845 may generate a slide to the 2016 low of 5497.4.
- The FTSE 100 ignores the soft China PMI’s published overnight and U.S. ISM manufacturing is on tap this afternoon
The FTSE 100 is trapped between the January 29 high of 6129 and the February 24 low of 5845. For now it would be fair to expect further consolidation between these levels.
On a break to the upper barrier at 6129, the FTSE 100 may reach the December 12 high of 6322. However, such a rally may turn choppy as the FTSE 100 meets with its downward-sloping 200-day-moving-average, and some traders will use this to establish short-positions in its vicinity.
Acting as a short-term support is the February 24 low of 5845. On a breach to this level, the short-term trend turns bearish and the FTSE 100 may reach its 2016 low of 5495. Such a decline would also be in line with current multi-month bearish trends as depicted by the continued lower-lows and the downward-sloping 200-day-moving-average.
China PMI Disappoints
China manufacturing PMI for February fell to 49.0 from 49.4, while the Caixin China manufacturing PMI slid to 48.0 from 48.4 in January. The Non-manufacturing PMI Services reached its lowest point since December 2008 as it slid to 52.7 from 53.5. The FTSE 100 has so far ignored this news, and so has the Chinese CSI 300 stock index.
Markit U.K. PMI manufacturing is on tap this morning, but it does not tend to have a strong influence on the FTSE 100. Instead, the U.S. ISM manufacturing on deck this afternoon may have a strong impact and a Bloomberg News survey projects a rise to 48.5 from 48.2.
For more data reports, which may influence the FTSE 100, please see our economic calendar.
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FTSE 100 | FXCM: UK100
Created with Marketscope/Trading Station II; prepared by Alejandro Zambrano
— Written by Alejandro Zambrano, Market Analyst for DailyFX.com
Contact and follow Alejandro on Twitter: @AlexFX00
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