FTSE 100 Technical Update: Last Summer Levels Providing Challenge
- The FTSE 100 finds challenging resistance from last summer
- No clear edge from either side of the tape
- Short-term levels of interest outlined
In recent trade the FTSE 100 has been slowly, one-by-one, challenging peaks created during the summer months of last year. This price action comes following the breakout above the 7/27 peak, which marked the top of a multi-week range. It was noted on Monday that gains could come, but they wouldn’t come easily given not only resistance, but the summer trading environment and general nature of how the FTSE often trades – choppy.
Yesterday, the UK index found the June ’15 peak a bit of a challenge again, reversing lower on the day. Nothing overtly bearish, but sellers were found lying in the 6865 vicinity for a second day in a row. The past two-and-a-half days may turn out to be nothing more than a consolidation, or a pullback could unfold back towards the 7/27 high of 6779.
Playing ping-pong around levels in a low-volatility/volume environment is likely to be the best-suited strategy in this tape. Otherwise, there isn’t a whole lot for us to lean on at the moment from the standpoint of a swing-trade. Risk/reward in either direction isn’t particularly favorable without further signaling.
Levels of short-term interest: Support – 6807/10, 6779, and 6730. Resistance – 6865, then 6900.
FTSE (UK100) Daily
---Written by Paul Robinson, Market Analyst
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