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UK100 is at 0.62% gain for the day

Market Analysis

UK100, H1

UK preliminary Q2 GDP came on the nose at 0.3% q/q and 1.7% y/y, up from Q1’s 0.2% in the case of the q/q figure and down from Q1’s 2.0% y/y in the case of the y/y figure. The data affirms the pronounced stagnation in the economy that was seen in Q1, following 2016’s average quarterly growth of 0.6%. Relatively high inflation rates, following the sharp drop in sterling since the Brexit vote last June, and consequential erosion in consumer spending power and confidence, have been weighing on UK growth. Political and Brexit uncertainties have been detrimental factors in play.

The UK100 was up 0.47% prior the U.K. GDP numbers and of course the Fed announcement, while after the release of the data continues north, by making an extension of its upper Bollinger Bands pattern in the hourly chart. The Parabolic SAR turned positive the last 3 hourly sessions while RSI is at 69. The pair is moving above 50 period SMA, while is is moving in the upper Bollinger Bands area since Yesterday’s London open. The bullish intra-day behavior is likely to be continued up to its next resistance levels, i.e. 7497.00 and 7510.00. A retracement might occurred after this levels. In the 4-hour chart, there is a positive picture as well, with RSI at 61 looking upwards, while the pair broke the 200-period SMA

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Andria Pichidi

Market Analyst

HotForex

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