European Open: FTSE bulls eye break of January 2020 high

Asian Indices:

• Australia's ASX 200 index rose by 16 points (0.22%) and currently trades at 7,233.30
• Japan's Nikkei 225 index has risen by 116.21 points (0.42%) and currently trades at 27,696.08
• Hong Kong's Hang Seng index has fallen by -328 points (-1.32%) and currently trades at 24,578.66
• China's A50 Index has fallen by -83.4 points (-0.55%) and currently trades at 15,023.31

UK and Europe:

• UK's FTSE 100 futures are currently down -38.5 points (-0.51%), the cash market is currently estimated to open at 7,622.52
• Euro STOXX 50 futures are currently down -67 points (-1.62%), the cash market is currently estimated to open at 4,088.23
• Germany's DAX futures are currently down -214 points (-1.39%), the cash market is currently estimated to open at 15,211.12

US Futures:

• DJI futures are currently up 76 points (0.22%)
• S&P 500 futures are currently up 36.75 points (0.26%)
• Nasdaq 100 futures are currently up 11.25 points (0.26%)

Asian equity markets remained under pressure as they tracked Wall Street lower overnight. The Nikkei 225 was an underperformer as it had some catching up to do with regarding the selloff, as Japan’s stock exchanges were closed on Friday. The ASX 200 was the only major benchmark to trade slightly higher by around 0.25%. European futures are also lower as they readjust to Friday’s selloff on Wall Street, whilst US futures are up slightly.

FTSE bulls eye break of January 2020 high

A hammer candle formed on Friday which could either be confirmed as a bullish or bearish reversal candle, depending on whether its high or low is broken first. Given the FTSE remains in an uptrend and within a bullish channel on the daily chart, our bias is for a break above 7690 which would take it to its highest level since July 2019. This would also confirm the hammer as a bullish hammer, as long as prices break higher and remain above Friday’s low. However, should momentum turn lower and break beneath 7597 (Friday’s low) the candle is confirmed as a hanging man reversal bar and could signal a correction.

FTSE 350: Market Internals

FTSE 350: 4314.19 (-0.15%) 11 February 2022

• 99 (28.29%) stocks advanced and 241 (68.86%) declined
• 6 stocks rose to a new 52-week high, 10 fell to new lows
• 39.43% of stocks closed above their 200-day average
• 33.71% of stocks closed above their 50-day average
• 18.86% of stocks closed above their 20-day average

Outperformers:

• +9.533% - Tate & Lyle PLC (TATE.L)
• +3.586% - Unilever PLC (ULVR.L)
• +3.044% - British American Tobacco PLC (BATS.L)

Underperformers:

• -5.096% - Wizz Air Holdings PLC (WIZZ.L)
• -4.633% - Reach PLC (RCH.L)
• -4.579% - Oxford BioMedica PLC (OXB.L)

Forex

Volatility was higher overnight for currencies than we’d usually expect on a Monday, although much of the moves were simply retracements against Friday’s direction. A lack of top tier economic data leaves volatility and sentiment in the hands of Russia-Ukraine headlines.

AUD and NZD were the weakest majors whist USD was the strongest. NZD/USD fell to a 5-day low after closing beneath trend support on Friday, and another Kiwi pair to monitor is EUR/NZD (today’s strongest pair) as momentum has realigned with its daily bullish trend and is holding above the 20-day eMA.

GBP/AUD has gapped higher and trades above 1.9000. We continue to suspect it has seen the end a 3-wave correction around 1.8800 and that it could now head back to the YTD highs and possibly beyond, within its multi-month bullish channel.

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