What’s inside:
- FTSE 100 closes at new record highs
- Momentum should continue to carry it higher
- Support and resistance levels outlined
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The other day we looked at the FTSE 100 up close on the hourly and said we gave the slight edge to sellers in the near-term, but that our conviction level was generally low given the generally choppy trading environment. Our slight bias turned out to not only be incorrect, but the footsie had its most impressive up day in nearly three months, with the help of not only a generally healthy appetite for stocks but a materially weaker pound as well.
The rally put the FTSE at fresh record highs and beyond the top-side trend-line extending back across peaks in 2013 and 2015. As far as shorts go, no interest on this end. As far as longs go? We would like to see a bit of consolidation up here, a demonstration of willingness by buyers to stick their bids out there at elevated prices on any minor weakness. Levels to watch on a retracement/consolidation is the top-side 2013 line, prior record high at 7354 and the 2/20 swing high of 7329. If the market is to continue to propel higher it seems unlikely the market would drop below the third level of support.
Eyes upward, the footsie is currently trading right at the top of a short-term upper parallel, which could cause a pause, but not expected to be a ‘rally killer’. The next levels of resistance with further strength comes in by way of a pair of top-side trend-lines – one off a peak in October 2015, another off a high in August of last year.
FTSE 100: Daily
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—Written by Paul Robinson, Market Analyst
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