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Sep 25, 2016

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Home » Latest News » Call Options Attractive As FTSE100 Attempts Test Of Technical Resistance At 6770

Call Options Attractive As FTSE100 Attempts Test Of Technical Resistance At 6770

Posted by Option_Banque in Latest News - September 19th, 2016 6:48 pm GMT

Stocks in the U.K. rose on Monday, extending their rally to a third trading day in a row. The British benchmark index, FTSE100 jumped by 1.4% in the morning session, powered by advances in mining and oil company shares.

Crude oil started the new week in positive territory after the clashes in Libya eased concerns over a global supply surplus amidst mounting signs that major oil producers are close to an output capping deal. A firmer oil price supported commodity-related companies. BP PLC rose 2.22%, and Royal Dutch Shell PLC moved up 1.9%.

Miners also gained today as a retreat in the U.S. dollar supported metal prices edge higher. The U.S dollar index, which tracks the strength of the greenback versus a basket of major currencies, inched down 0.17% to 95.85. Glencore PLC led gainers, soaring strongly after rating agency Credit Suisse upped its rating on the Anglo–Swiss multinational commodity trading and mining company to “outperform” from “neutral”. The bank said rising coal prices would help the company improve its free cash flow generation abilities, heading into 2017.
Other miners are also moving higher on the day such as Anglo American PLC up 5.89%, BHP Billiton adding 3.49%, Fresnillo PLC ticking 3.33% higher and Rio Tinto surging by 3.12%.

Rolls-Royce Holdings PLC shares rose 1.44% as the engine maker on Sunday said it will not give up the battle to boost profitability. Rolls-Royce is expanding job cuts and going to shed another 200 management roles through a buyout program.
In general, gainers appeared to far outweigh losers. Among a handful of stocks trading lower are two pharmaceutical companies. Shire PLC lost 0.51% while AstraZeneca fell by 0.43%.

Fig: FTSE H4 Technical Chart

The FTSE100 created a big gap up on the market open today and broke the resistance at 6767.60. The index retreated a little after facing resistance at the downtrend line connecting lower highs since the start of September. The price action has broken through both the MA’s from below and the MAs are also heading upwards and are placed firmly below the price action. This is highly supportive for further advances. However some concerns for the uptrend are stemming from the fact that bulls have driven the market into an overbought state considering the stochastics chart.

Trade suggestion
Buy Digital Call Option from 6797.30 to 6815.00 valid until 20:00 September 19, 2016

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