Hope you are all well!
In this blog post we will be taking a look at the UK100 Market on the Daily and 4 Hour timeframes.
First of all it is key to make note that the weekly candle has closed as a strong bearish engulfing, engulfing the previous weekly candlestick.
Now taking a look at the daily chart below you should be able to see that price on Monday formed a handing man candlestick at the 7000 Monthly resistance. This gave price the push bearish that has led price to break the weekly support of 6850.
Price is now below the daily 20 & 50 EMA’s with price showing a rejection off the 20EMA on Friday.
Price now sits at the 6795 support area.
Now going down to the 4 Hour timeframe we can see that price has shown a double top at the 7000 resistance where price now sits back at the neckline/support at the area of 6795.
Price is below the 4 Hour 20 & 50 EMA’s with the 20 EMA recently crossing back over with the 50 EMA to align bearish.
Over the next week we could very well see further bearish movement within this market. We will be watching to see if price shows a break retest of the 6795 support for a short opportunity.
If we are able to take a short position we will look to target the 6700 support.
Remember that this is our perspective and you should trade with your own analysis,
James from Technical FX