The FTSE 100 index represents the performance of 100 top companies within the London Stock Exchange. If you want to profit from trading the FTSE 100 within the Digital Options platform, you’ll need to understand the factors that impact its price movement. Below are the primary factors that you’ll want to be looking at prior to entering into a FTSE 100-based trade.
When the earnings reports for the majority of the FTSE 100 companies are favorable, there should be more buying than selling. As such, the value of the index should increase. The opposite can also take place. When earnings reports are poor and investor confidence drops, selling should increase and the value of the index should decrease. The FTSE 100 is particularly impacted by the earnings reports of major U.K. banks, so pay particular interest to such reports when they are released.
The , and not the U.S., is the primary trading partner of United Kingdom. As such, when the Eurozone struggles, so does the FTSE 100, and when the Eurozone thrives, so does the FTSE 100. Of particular interest should be economic news releases relating to interest rates, manufacturing data, GDP, inflation, and housing data coming from the U.K. All of this data can influence investor sentiment and send the FTSE 100 value trending either up or down, either of which can be profitable for the digital options trader.
While it is wise to use fundamental factors to trade the FTSE 100, don’t forget about technical analysis. This index typically delivers lower levels of volatility than the U.S. or Asian markets, which means that it can be a bit more challenging to predict its upcoming movement. Practice will certainly help, and there are several digital options strategies that pair well with stable market conditions. Just remember to keep an eye on Eurozone conditions in order to trade this index with above average success.