Two trades to watch: FTSE, Brent

FTSE treads water ahead of PMI data. Brent strikes $75.00

Charts (3)

FTSE looks to PMI data 

The FTSE along with European stocks are treading water, despite a stronger finish on Wall Street. Federal Reserve Chair Jerome Powell reassured the markets over inflation and monetary policy, calming market nerves. 

Markets are starting to stabilize after the Fed’s hawkish turn last week. Meanwhile tensions between US and China rose after a US sailed through the Taiwanese straight. 

PMI data will be in focus. UK PMI data is expected to show that the manufacturing sector continued expanding at an impressive pace in June at 64, although just down slightly from 65.9 in May. The services sector PMI is forecast at 62.8, marginally down from 62.9 in May. 

Learn more about the FTSE

Where next for the FTSE? 

The FTSE broke below its ascending channel at the end of last week. The index spiked to a low of 6950 below pushing back over 7000 key psychological level and finding support on its 50 sma at 7030.  

The index continues to extend the rebound today with the RSI supportive of further upside. Buyers could look towards resistance at 7120 high June 2 ahead of 7170, the confluence of the lower band of the ascending channel and June 10 high. 

The 50 sma could offer support at 7030. A break below this level could negate the near term up trend. It would take a move below 6950 for the bears to gain traction. 

 

Brent hits $75.00 

Oil is pushing higher as rising fuel demand drained inventories. 

API data revealed 7.1-million-barrel draw, well ahead of the 3.6 million forecast, this comes following an 8.5 million draw last week.  

Fuel demand has been boosted by key markets such as US, China and Europe reopening their economies. 

EIA inventory data is due later today.  

OPEC+ will meet to discuss output next week and could look to raise production. 

How to start trading oil

Where next for Brent? 

Brent trades at multi-year highs and hits $75.00. It is attempting to break out above its ascending channel within which it has traded since late March.  

The RSI is heading into overbought territory which warrants caution for further bullish bets. A period of consolidation or a pull back could be on the cards. 

A meaningful move over $75 could see fresh multi year highs achieved, with buyers looking towards $80 round number and psychological level.  

It would take a move below $71.50 to negate the near-term uptrend. A move below 65.00 could see sellers gain traction. 

How to trade with City Index

Follow these easy steps to start trading with City Index today:

  1. Open a City Index account, or log-in if you’re already a customer.
  2. Search for the market you want to trade in our award-winning platform.
  3. Choose your position and size, and your stop and limit levels
  4. Place the trade.

More from Trade Ideas

Disclaimer

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.