FTSE 100 Further Develops Range on Sharp Turn Lower
- FTSE 100 turns sharply lower from near key line of resistance
- May soon find itself once again testing support
- Continuing to favor range-trading off key levels
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After holding major support following last week’s BoE meeting the FTSE 100 mounted a sizable rally. This is what we had to say on Monday regarding the market’s progression: “Trouble lies not far ahead, though…The January to March top-side trend-line we’vediscussed at length here will once again likely prove to be a challenge to overcome.”
Actually, trouble began just ahead of this all-important line of resistance, as the footsie stopped about 10 points shy. At any rate, we’ve seen a turn lower and the major support area surrounding 7400 looks headed for yet another test.
Generally choppy trading conditions. Things will sort themselves out at some point, but until they do we’ll view price action through a range-trader’s lens. First things first – support is support until it isn’t. We’ll watch price action for signs of turning momentum off the 7400/378 area. Should we see a daily close below the BoE-day low then the footsie may be ready to give up ground. It’ll need to break the June/’Brexit’ trend-line first, but with major support broken that may not prove to be much of a challenge for sellers.
Should a turn take place from around current levels and push back towards yesterday’s high and the January/March top-side trend-line, we’ll watch for stalling momentum for a possible short set-up.
FTSE 100: Daily
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---Written by Paul Robinson, Market Analyst
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.