Technical analysis for 3rd November 2026
Global financial markets begin Tuesday with a cautious tone as investors prepare for the US midterm elections, while renewed selling in artificial intelligence-related shares continues to overshadow the positive impact of falling energy prices.
Monday produced a striking divergence. European equities generally advanced as oil prices fell sharply, but Wall Street's early recovery faded, leaving the S&P 500 and Nasdaq lower.
Brent crude suffered a substantial decline amid renewed hopes of diplomatic progress involving Iran. This could help ease global inflationary pressures, particularly in Europe, but the improvement has not been enough to restore confidence in US technology shares.
Asian markets are also under pressure this morning, with South Korean semiconductor companies leading the declines.
The central question today is whether cheaper energy and lower bond yields can support a broader equity recovery, or whether concerns about AI spending and the US election will keep investors on the defensive.
The FTSE has weakened overnight following Monday's recovery, slipping below its daily pivot at 10748. The 30-minute chart shows a series of lower highs, while the daily chart is struggling to establish a sustained move above resistance.
However, the broader picture is not decisively bearish. The index remains above its daily 10 and 25 EMAs, and daily RSI is still above 50.
My prediction today is for an initial attempt to recover towards 10748-760, followed by renewed selling if that resistance holds.
I favour selling a confirmed rally rather than chasing the FTSE lower initially, as a bear Tuesday looks likely to play out as once again we have dropped from the 10775 level.
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