This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
FTSE 100 plummets below key support level
The FTSE 100 has suffered at the hands of a stronger pound, as the repercussions of a rising inflation rate take its toll on the pound itself, and subsequently the FTSE 100. The break below 7357 brought about a bearish short-term outlook, with the index heading towards the lower end of its recent range. With that in mind, it makes sense to sell into rallies, with a break above 7403 needed to negate the bearish outlook. Watch out for trendline support to the downside, which coincides with wider 76.4% retracement.
Ultimately, we could be heading towards a move back into the lower end of the 7300-7460 range. Yet a break below 7319 would be required to negate the creation of higher lows.