On Wednesday we made note of a bullish pattern developing in the FTSE 100, one which could lead to a break to the record highs created in 2015. We still need to see a closing daily bar outside of the inverse ‘head-and-shoulders’ pattern (and preferably above the 8/15 high at 6955), but so far so good, and as long as the index holds strong through the end of the day, then the odds of seeing the UK index trade back above 7100 increase significantly.
In our Q4 forecast regarding equity indices, we had this to say about the technical picture: “If global markets hold a bid, look for the FTSE to attempt breaking to new yearly highs above 6955 and challenge the record high…”Strength among global indices has been varying, but holding a bid, and in the case of the US and now UK, they are looking to notch out new record levels.
The next significant level is the old record high at 7123, while the measured move target, based on the height of the formation, clocks in around 7185.
At this time, it would require trade back below Friday’s reversal day low and the trend-line extending back to 9/15 for the bullish view to turn south.
FTSE 100: Daily
(Click on image to enlarge)
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