FTSE 100 sees rebound ahead of UK election
The FTSE 100 managed to find support around its June low at 8,106, a level from which it is recovering ahead of Thursday’s UK election. Provided that the June and current July lows at 8,115 to 8,106 underpin, the 55-day simple moving average (SMA) at 8,236 will be back in sight. A rise above Friday’s high at 8,239 would put the previous week’s high at 8,314 back on the plate.
Support below 8,106 sits at the 8,095 May trough.
DAX 40 bounces off two-week low
The DAX 40 dropped back towards the psychological 18,000 mark on French election worries before recovering later in the session on Wednesday, helped by US markets which rose following comments by Federal Reserve (Fed) Chair Jerome Powell which were in line with the June Fed meeting.
The 11 June low at 18,278 and 55-day SMA at 18,363 represent possible upside targets ahead of Sunday’s second round French elections with the 26 June and Tuesday’s low at 18,045 to 18,023 offering possible support. Were it to give way, the June low at 17,950 would be back in play.
CAC 40 recovers from election jitters sell-off
The French CAC 40 regained all of Tuesday’s losses as an absolute majority for the far right Rassemblement National party looks unlikely now that 214 candidates in third place dropped out so that non-RN votes aren’t split with directions being given to vote for non-RN parties.
The 200-day SMA at 7,640 represents the next upside target ahead of key resistance seen between this and last week’s highs at 7,721 to 7,725. This key resistance zone needs to be breached for a medium-term bullish reversal to unfold.
Significant support below Tuesday’s low at 7,475 sits at the June and current July lows at 7,464 to 7,455.
