FTSE – get ready for a weak opening

FTSE futures, in line with the weakness seen in other major European equity index futures and oil prices, are indicating the index is likely to open 28 points or 0.45% on the day. Oil benchmarks – WTI and Brent – are down more than 2% and thus mining and energy shares are likely to lead the drop in FTSE

Hourly chat formation – Bearish price-RSI divergence

Resistance – 6418.25-6430, 6447.30, 6502

Support – 6355, 6307.28, 6261.71

• Bearish price-RSI divergence and oil price drop means index could drop to hourly 50-MA level of 6355 levels. A break lower could yield 6307.28
  

• Bears need to view this as a correction as daily RSI at 68.00 indicates there is still room for further upside in the pair. Hence, fresh demand could be anticipated on drips and bullish invalidation is seen only if the day end closing is below 200-DMA level of 6206 levels.
  

• On the higher side, a break above 6430 would indicate a failure of bearish price-RSI divergence and signal another leg upwards towards 6500 levels.