FTSE rises despite re-opening set to be delayed
FTSE along with other European bourses point to a stronger start as investors look ahead to an expected dovish Fed.
The UK index is advancing despite PM Boris Johnson looking set to push back the final step of reopening the UK economy for 4 weeks. An announcement will be made later.
Concerns are growing over the rapid rise of the delta variant of covid in the UK which is reportedly 60% more transmissible.
Pubs, clubs and other hospitality venues are expected to be told they need to wait another 4 weeks to fully reopen.
The FTSE could find some support from oil majors as oil prices continue to rise to fresh 2 year highs
Where next for the FTSE?
The FTSE trades above its descending trendline dating back to early November. It trades above its 50 & 100 sma in an established bullish trend.
There appears to be a bullish crossover forming on the MACD which could keep buyers hopeful.
The FTSE briefly touched its 16 month high at 7165 earlier. A move beyond here is required to target 7200 round number and 7230 the low from January 31st 2020 pre-pandemic.
It would take a move below 7050 to negate the near term bullish trend. This could open the door to support at 7010 the 50 sma and ascending trendline support.
Gold falls below key support
Gold trades around weekly lows as the US Dollar remains firm.
The US Dollar found support on Friday following upbeat US consumer confidence, which rose to 86.4 in June, up from 82.9 in May.
Pre-Fed jitters are set to dominate this week as investors continue to weigh up whether the Fed will stick with the dovish tone or move towards talking about talking about tapering.
Where next for Gold prices?
Gold has fallen below its ascending trendline dating back to late March. A daily close below this level could validate the bearish reversal from $1900 at the start of the month.
The bearish MACD suggests there could be more downside to come. Sellers would need to break below support at $1860 in order to look towards support at $1830, the 50 sma on the daily chart and also the trend line support dating back to August last year.