FTSE 100 continues the rebound from three month lows amid speculation of a coordinated move from the central banks around the globe. Wall Street indices registered hefty gains yesterday on rising bets that the Fed might aggressively cut interest rates, as the markets were pricing in a 96% chance of an interest cut. Rumours that the G7 countries are working on a statement providing a plan to offset the economic impact of coronavirus outbreak helps investors sentiment.
On the coronavirus spread front, there are signs that the coronavirus spread was slowing in China, as it reported the lowest number of new cases in more than a month on Tuesday. However, the coronavirus outbreak around the world was accelerating. In Italy the confirmed cases reached 1845 while the deaths are 52.
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FTSE 100 is 2.12% higher at 6795 recovering all of last Friday’s heavy losses. FTSE managed to rebound from the three month lows on speculation of central banks intervention. The technical outlook for FTSE is still bearish despite the two days rebound.
On the upside, the first resistance for the FTSE index stands at 6,814 the daily top. The next resistance level for the index is at 7041 the high from February 27th. A move above might test the next supply zone at 7199 the highg from February 25th.
Traders attention has turned to lower levels, the first support for the FTSE index stands at 6654 the daily low. If the index breaks below, the next support area is at 6497 the low from March 2nd. A credible break below might open the way for the low from March 28th at 6457.