FTSE: strong downward potential – FXStreet

By FXStreet London shares extended their slides, and the Footsie closed at 6,112.02, down by 1.19% or 72 points on Wednesday.

The index fell to near a 1-month low as poor earnings reports sent the mining sector nose-diving. Randgold Resources led the decline by plummeting 11.7% as, despite reporting a 13% rise in net profit to 54 million in the first quarter of 2016, the firm’s metal production declined 11%, compared to the previous record quarter. BHP Billiton fell 5.8% after Brazilian prosecutors filed a $44 billion lawsuit against the miner and its partner Vale over the collapse of a dam that killed 17 people. Glencore lost 3% after reporting a cut in production of copper, zinc, lead, coal and oil as a result of low commodity prices.

FTSE technical perspective

“From a technical point of view, the daily chart shows a strong downward potential at the time being, as the index has plummeted below its 200 DMA and is now barely holding above the 100 DMA, whilst the technical indicators present sharp bearish slopes within negative territory,” said Valeria Bednarik, chief analyst at FXStreet. “In the 4 hours chart, the technical picture also favors the downside, as the Momentum indicator resumed its …read more

Source:: FX Street