FTSE bounces after pullback

<p>The FTSE 100 Index (daily chart) pulled back below the key 6650 support this past Friday before starting the new week with a bounce. From […]</p>

The FTSE 100 Index (daily chart) pulled back below the key 6650 support this past Friday before starting the new week with a bounce.

From a three-week high of 6835 early last week, the UK equity index dropped sharply for three consecutive days late last week to hit a three-month low of 6622 on Friday. This low was just slightly under the previous low established in early July around the 6641 level.

Prior to these two recent drops below the 6650 support level, the FTSE had been pushing up against a key resistance zone around the 6875-6885 area, struggling to break out to new long-term highs but without success.

Last week’s pullback below 6650 was a minor respite from the strongly bullish price action that has pervaded most of the major global indices for the past several months. The FTSE, however, remains due for a larger pullback or correction that could bring the index down at least to a price target around the 6500 level, last hit in mid-April.

To the upside, any extension of the current bounce off support should meet key resitance around the 6800 level.

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.