FTSE 100: Short-Term Trend Turns Choppy
Today, I view the FTSE 100 from the four-hour timeframe standpoint and its respective levels as the short-term charts have turned choppy and somewhat less reliable.
As seen below, the overall trend is bearish below 6085 and may therefore reach the January 26 low of 5767 and the January low 20 of 5601, in the case of an extension. The break to 5767 is easy to understand as it’s a classic breakdown signal and some traders short on the break with a protective stop above the latest swing high (right now 5950).
Other and more aggressive bearish traders will most likely use the current bounce in the FTSE 100 index to short. The index has corrected 50% of the decline from last week’s high of 6125 and this would generate a potential loss of 170 points vs. a potential gain of 313 were it to reach its January low.
Bullish traders will wait for the trend to turn neutral, though this may take a few days.
Today, watch out for U.S. Jobless claims and Factory orders as the former is projected to print 277K (Bloomberg news survey), while the latter is expected to decline by 2.8% month on month.
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FTSE 100 | FXCM: UK100
Created with Marketscope/Trading Station II; prepared by Alejandro Zambrano
--- Written by Alejandro Zambrano, Market Analyst for DailyFX.com
Contact and follow Alejandro on Twitter: @AlexFX00
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