FTSE Technical Analysis – In Bounce-mode Again, March Lows Targeted
FTSE Technical Highlights:
- FTSE oversold bounce underway
- Trend and support break suggest more selling to come
- Targeting March low after bounce finishes
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FTSE oversold bounce underway
The FTSE is bouncing from oversold territory along with global markets following the most recent swoon which finally included U.S. markets. So far, the bounce is taking some time to develop, but the FTSE may pick up steam first before running its course and turning down again.
Looking for resistance levels we are left without anything price-related until 7220, the low from last month. If a countertrend move unfolds similar to September’s bounce then we could see a run to that point, but it may be a tough play for longs.
The broken trend-line from February 2016 is viewed as important and helps further along the topping sequence since last year. The RST pattern has been in full-swing since the lower high created in July, with the March low first targeted. We’re close but not quite there yet.
A drop to the March low in the mid-6800s will certainly make for a big test. From a macro standpoint a break will have the reverse symmetrical triangle (RST) pointing to a much larger decline and likely an omen for global stocks.
FTSE Daily Chart (Reversal from confluent support)
FTSE Weekly Chart (‘RST’)
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at@PaulRobinsonFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.