FTSE 100 Rises as Bond Yields Fall Ahead of BoE Decision

The Bank of England’s monetary policy meeting is scheduled for November 6. The interest rate is highly likely to remain unchanged at 4.00% for the third consecutive time. The latest data supports this scenario: retail sales in September rose 0.5%, pushing the annual rate from 0.7% to 1.5%. Meanwhile, the core index grew 0.6% month-over-month and accelerated from 1.3% to 2.3% year-over-year. Maintaining borrowing costs will continue to support both the national currency and the stock market.

Investor reaction to the central bank’s cautious stance has been reflected in declining bond yields: the 10-year yield dropped from 4.440% to 4.403%, the 20-year yield from 5.138% to 5.064%, and the 30-year yield from 5.229% to 5.184% over the week.

Among the FTSE 100 leaders are Standard Chartered Plc. (+3.19%), Lloyds Banking Group Plc. (+2.31%), Barclays Plc. (+1.91%), and NatWest Group Plc. (+1.89%).

The top decliners include Fresnillo Plc. (–4.97%), Flutter Entertainment Plc. (–2.92%), and Ashtead Group Plc. (–2.52%).

Support and Resistance Levels

On the daily chart, the index continues its local correction, attempting to approach the resistance line of the ascending channel with boundaries between 9800.0 and 9400.0.

Technical indicators maintain a stable buy signal that is gaining momentum after the recent correction. The EMA range on the Alligator indicator is widening, and the AO histogram forms new bullish bars above the zero level.

Support levels: 9540.0, 9190.0.

Resistance levels: 9740.0, 10000.0.

Trading Scenarios and FTSE 100 Outlook

If the price continues to rise and consolidates above the 9740.0 resistance level, buy positions will remain relevant with a target at 10000.0 and a stop loss at 9600.0. Implementation timeframe: 7 days or more.

If the price reverses and breaks below the 9540.0 support level, sell positions will be appropriate with a target at 9190.0 and a stop loss at 9650.0.