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The UK UK Index has extended gains this morning, finally breaking beyond multi-month intersecting resistance at 7265, to exit a Feb/Mar falling channel, and open the door for a retest of this week’s 7317 peak. The catalyst is GBP extending a helpful retreat from this week’s highs on softer than expected UK Inflation (Core 2.3% vs consensus acceleration to 2.5%; weakest since last April) which took the price growth metric much closer to the Bank of England’s 2% target, shaving the probability of a UK interest rate hike being necessary in May (81% vs 86% prev). This dampened demand for GBP helping the UK Index by its usual boost to the value of bluechips’ international earnings and foreign dividends.
The UK 100 sees most points contribution today from RDSb/BP (higher oil prices, weaker GBP), RIO (Q1 production report, HSBC upgrade), BHP/GLEN/AAL (RIO read-across, China stimulus, Copper off lows) and Shire (M&A hopes), all adding at least 2 pts, while only BATS (extending a 7-day bearish reversal) deprives the index of anything meaningful.
The UK Index 100 has broken above resistance at 7265 to make a test of 7290. Can it revisit the highs of the week at 7317 and go on to challenge Feb highs of 7335?
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The UK Index 100 has broken above resistance at 7265 to make a test of 7290. Can it revisit the highs of the week at 7317 and go on to challenge Feb highs of 7335?
Watch levels: Bullish 7295, Bearish 7270
Solid Green line
Possible support
Solid Red line
Possible resistance
Important: The information provided above does not constitute advice or opinion and must only be regarded as technical observations.
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