Technical analysis for 28th October 2026
Financial markets face one of the most important sessions of the month, with the UK Budget and the Federal Reserve's interest-rate decision both taking place today.Global equities have benefited from renewed enthusiasm for artificial intelligence, particularly in Asia, while easing oil prices have provided some relief from inflation concerns. However, the improvement in sentiment is not uniform. The FTSE 100 fell yesterday as investors prepared for the Budget, whereas Germany's DAX continued to recover.
Gold has also regained some ground, reflecting a combination of lower oil prices and expectations that the Federal Reserve will leave interest rates unchanged. The central question today is whether policymakers can reassure investors about inflation and borrowing costs without undermining the recovery in economic confidence.
Asia stocks rallied on Wednesday as renewed AI enthusiasm buoyed sentiment ahead of earnings from industry bellwethers later in the US day, while the New Zealand dollar tumbled after the country's central bank unexpectedly held rates steady.
My prediction today is for a bearish session unless the FTSE can recover above 10700-721. I favour selling a confirmed recovery rather than chasing the market lower near support.
There is an important complication today: major UK fiscal and monetary-policy headlines could override the technical picture.
Today's bias: Bearish below 10708-721
The market is showing lower highs and declining momentum. The daily chart is also beginning to resemble a developing correction rather than a simple pause in the previous uptrend. Thew 2h chart is also bearish with the Hull MA resistance at 10695 adding weight to a reaction at this area.
The key battleground is 10632 support versus 10691-721 resistance. A recovery above 10721 would weaken the bearish interpretation, while a sustained break below 10632 would expose considerably lower levels. Should we drop below Fridays low at 10631 then I am looking at the 10556 level as the next support and would likely try a long here as well.
Of course today has the UK budget, largely expected to focus on cost of living help, and the Fed interest rate - a surprise 0.25% rise may be on the cards....
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