FTSE 100 Index Drops After Labour Market Data Release

The British stock index, FTSE 100 (UK 100 on FXOpen), fell by nearly 1% yesterday in response to new economic data pointing to an increase in unemployment.

 

 

 

 

 

 

According to ForexFactory:

  • The Claimant Count Change, representing the number of unemployment benefit claims, was 50,000 (expected = 10.2k, previous month = 8.4k). This is the highest figure since March 2021.
  • The unemployment rate edged up slightly to 4.4% from the previous 4.3%.

However, today the FTSE 100 (UK 100 on FXOpen) chart is indicating signs of recovery.

Fundamentally:

  • The GDP news did not bring any negative surprises.
  • A weakening labour market might lead the Bank of England to reduce the interest rate to stimulate the economy, which should support the stock index.

trading chart

Technical Analysis Perspective:

  • At the decline’s lowest point, the price found support from the median line of the upward channel established since last autumn (shown in blue).
  • The median line is strengthened by the 50% Fibonacci retracement level of the bullish impulse A→B.
  • The price failed to stabilise below the late May low around the 8150 level, suggesting a local capitulation of the bears.

Bulls, in turn, might leverage these technical support factors to try and resume the upward trend within the blue channel. To achieve this, they will need to break through the trendline resistance (shown in red).

FXOpen offers spreads from 0.0 pips and commissions from $1.50 per lot. Enjoy trading on MT4, MT5, TickTrader or TradingView trading platforms!

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

The subject matter and the content of this article are solely the views of the author. FinanceFeeds does not bear any legal responsibility for the content of this article and they do not reflect the viewpoint of FinanceFeeds or its editorial staff.



Financefeeds.com