FTSE 100 Trying to Break Yet Another Range and Trade in Open Space
- FTSE 100 trying to push out of second range created over past three weeks
- A solid rally out of the second range would be above important confluence of resistance
- If it fails, then more of the same with a downward bias
When we looked at the FTSE 100 last week it was on the verge of breaking a painful trading range lasting nearly two weeks. What came next? Another painful trading range lasting a week. Certainly not the most ideal trading conditions, but now that the footsie is on the move beyond important technical thresholds there might be some hope for better directional price action.
Coming out of the first range on June 12 the market ran aground by trading into a top-side trend-line extending from the 2013 high over the 2015 high and then over and under several short and intermediate-term swing points since early January. There is the underside of the June/’Brexit’ trend-line in confluence as well. The inability to climb through this crossroad kicked off the beginning of the second range which today we are seeing the market try and break free of.
We could of course see an intra-day reversal and close near unchanged or lower on the session, and in this case, it would be considered a failure to maintain above an intersection of key resistance. If this happens, a key reversal bar could etch itself out and more choppy trading conditions with the possibility of a downward bias look likely to prevail.
But if today’s rally can hold as is or even further the FTSE towards higher levels, the index will be breaking out into open space as no real significant hurdles lie ahead until near record high levels.
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.