Brexit and The FTSE 100 Go Hand In Hand

The Financial Times Stock Exchange 100 Index, also called the FTSE 100 is a share index of the 100 companies listed on the London Stock Exchange with the highest market capitalization. The largest sector is the Financials sector that makes up 20% of the index. Energy companies come second with a weighting of 17%.

London is the world’s capital for Forex and is one of the world’s biggest financial centers currently, but leaving the EU by way of a "hard" Brexit would tarnish this status symbol. In a "hard" Brexit situation, the UK would not have to sign up to free movement of EU nationals, or be subject to the European Court of Justice. It would probably not have to contribute to the EU budget. It would also be able to sign free trade deals with other countries

Last week, the FTSE 100 jumped after Thursday’s positive meeting between Prime Minister Boris Johnson and Ireland’s Premier Leo Varadkar. That was followed by further supportive comments, before a recommendation that Britain and the European Union enter into line-by-line negotiations on a Brexit accord.

European stocks on Tuesday rallied on optimism over the possibility of a deal for an agreed Brexit pact as well as better-than-forecast U.S. earnings.

U.K. banks switched directions for a third straight session, this time rising, as they trade on the relative prospects of an agreed deal for Britain to exit the European Union. Lloyds Banking Group LLOY, +5.24% and the Royal Bank of Scotland RBS, +5.07% rose as Michel Barnier, the top EU negotiator, said a deal was possible this week, and Bloomberg News reported negotiators were closing in on a draft deal.

Source

So if a deal is reached, how high can the FTSE 100 go?

Monthly Chart (Curve Time Frame) - monthly supply is at 7750 and monthly demand is at 6690.

Weekly Chart (Trend Time Frame) – the trend is sideways.

Daily Chart (Entry Time Frame) – the chart suggests to play the extremes, wait for price to get to the daily supply or daily demand before considering a trade set-up.

This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.