FTSE 100 pauses its three-day rebound as investors assess earnings.

FUNDAMENTAL OVERVIEW:

European markets shifted downwards on Tuesday, losing the positive momentum observed in the preceding trading session.

Tuesday saw the UK’s blue-chip share index come to a halt following a three-day rebound. Investors took a moment to evaluate earnings reports and anticipated economic data that might provide insights into the Bank of England’s (BoE) monetary easing intentions.

The FTSE 100, representing the top UK companies, experienced a 0.1% decline, driven by losses in healthcare and consumer firms that outweighed gains in the mining sector.

Investors are anticipating data on UK business activity and consumer confidence later this week to assess the state of the British economy and gain insights into the potential interest rate decisions by the Bank of England.

Investors eagerly anticipate the European Central Bank’s policy decision. Although no new policies are anticipated, any indications of potential rate cuts are closely watched. The banking sector demonstrated resilience, yet specific stocks, such as Commerzbank, experienced declines following analyst downgrades.

FTSE 100 TECHNICAL ANALYSIS DAILY CHART:

Technical Overview:

FTSE 100 is currently trading within a down channel.

FTSE 100 is positioned below all the Moving Averages (SMA).

The Relative Strength Index (RSI) is in the Selling zone, while the Stochastic oscillator suggests a Negative trend.

Immediate Resistance level: 7537.9

Immediate support level: 7493.8

HOW TO TRADE FTSE 100

After an ascent, the FTSE 100 is experiencing a decline in prices and has entered a downward channel. Currently, it has breached the previous day’s low and formed a bearish engulfing pattern. It is now approaching a significant support zone, and if this zone is breached, further downside movement is likely.

TRADE SUGGESTION- STOP SELL– 7480.9, TAKE PROFIT AT- 7396.3, SL AT- 7543.4.