The passing week revealed like in other stock markets that the bulls are back, with a convincing Weekly reversal up while respecting the important Low of 6654.48 mentioned coupled of times before.
The current bullish setup to reach the 7250 level is back in play. We mentioned in the past also the level of 7215 as the target for the Bullish pinbar (a Spring) printed by the Brexit month of June. The Quarterly bar embedding the Brexit Monthly bar (2nd Quarter 2016) is also a bullish pinbar on sloping 20 SMA pointing approximately to the same level, 7220.
In the larger scale, pay attention that the current Yearly price action is made after the first attempt to break the 15 year range discussed many times before – has been made during the previous year. Since we are after the expected reaction (the previous consolidation yearly bar) and already have a yearly bullish OKR this year, don’t expect to market to reverse in the higher timeframes without a considerable thrust up.
Current higher targets are the previous Semiannual bullish pinbar on sloping 8 EMA, that once got a thrust above – points to the 7500 area as its target, where the upper Bollinger band for this timeframe is currently lying. The Yearly bullish pinbar on sloping 8 EMA of year 2009 points to 7420 as a target.
The Monthly High at 6997.25 is very likely to be taken out during the current Daily strong momentum, an important resistance is right above, at 7000, and the next most important resistance above it is the 7024 level.
Pay attention to the Weekly High. To continue the current strength, it should be taken out by the beginning of the week. Any Daily reversal down without having the Weekly High taken out first – is an important sign of weakness.
A very good opportunity might come from taking out the Weekly High first, followed by a retracement on the Daily. A Daily reversal up then is a very good scenario to reach the Monthly High.
FTSE : Daily, Weekly, Semiannual and Yearly charts (at the courtesy of prorealtime.com)
Disclaimer: Anyone who takes action by this article does it at his own risk and understanding, and the writer won’t have any liability for any damages caused by this action.