UK's benchmark stock index, FTSE 100 seem to have recovered from its long losing streak and risk reward remains very attractive to long the index.
In spite of recent financial turmoil and sharp drop in FTSE 100, the fact remains that UK's economy is doing quite well and UK remains the one of the fastest growing among developed nations.
While some might point out that looming rate hike from bank of England (BOE) next year is negative for stocks, it is also key to remember that monetary policy will remain very accommodative even after the first rate hike.
Moreover ultra-loose monetary policy from European Central Bank (ECB) is likely to lead to recovery in Europe, which is positive for FTSE 100 and it will also benefit from inflow over ECB bond purchase.
Trade idea -
- Buy FTSE 100 future at current price (6150) with target around 6600 and stop loss at 5900 and 5750 area.
- Risk reward for the trade is quite attractive.


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