Market Overview: FTSE 100 Futures
FTSE 100 futures went lower last week, with a second leg down in a strong pullback from the ATH. We are always in short on the daily chart, which is likely to become a bull flag on this chart. But it’s disappointing for the bulls, who should not have let five bear bars in a row happen. Expect sideways to down next week.
FTSE 100 Futures
The Weekly FTSE chart
- The FTSE 100 futures went lower last week, with a bear bar closing near its low.
- It is the fifth consecutive bear bar in a tight channel with two legs.
- The bulls see a strong bull breakout to a new ATH and a pullback. They expected two legs sideways to down.
- The bears see a trading range and a breakout, and we are failing.
- The bulls had a strong enough spike to warrant a second leg on a higher timeframe.
- The bulls also had at least 3 legs up from BOM earlier in the year.
- Some bulls will look at the three strong bull bars as a reset of the leg count.
- The bears see it as a buy climax, wanting it to fail and get a measured move down.
- The price was far from the moving average, so some bulls were waiting to buy lower. A test of the breakout point and the moving average is a high-probability buy zone.
- April had a weak buy signal before that spike, and trading ranges usually test back to those entries to let out countertrend traders. So we might test back all the way to close the gap.
- If the gaps stay open, that is more bullish.
- It was a High 1 buy the prior week but a bear bar, so weaker signal bar. Traders will look at the quality of the High 2, which is a stronger signal in a bull trend.
- We are still always in long – above both moving averages, strong bull trend, ATH, bull breakout with gaps, but always in traders probably exited below the second or third bear bar.
- I think bears will be scalping only with the bull profit-taking and will get out at the first time of trouble.
- Expect sideways to down next week.
The Daily FTSE chart
- The FTSE 100 futures went lower on Friday with a small bear bar with a big tail below.
- Some computers will see it as a bull bar.
- It is the second leg down in a bear spike and channel after consecutive bear bars below the moving average.
- A second leg down on the weekly chart is a bear spike and channel on the LTF – the daily chart.
- The bulls broke out of a bull channel, and there was only 25% that it would succeed. They typically fail in 5 bars.
- When the market reverses, it often tests the other side of the channel below, which is about where we are.
- The bulls see a strong breakout and a test of the breakout point on the monthly chart. They want a wedge reversal for a test of the highs.
- The bears are on a swing down. They broke below the last higher low and closed the gap to the second leg of the bull breakout. They want a measured move of that second leg down.
- Bulls tried to prevent it from falling so quickly, so now most will wait for a better buy signal to trigger before entering.
- Most likely, it is a trading range, and we are looking for the bottom of it.
- Always in short, so expect sideways to down next week.
- Better to be short or flat.
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