The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.
FTSE falls into major support confluence
The FTSE has followed its US counterparts in the past 24 hours, with the index falling to a key support level. The cluster of trendline, Fibonacci (76.4%) and simple moving average (200-period on four-hour) support at the current 7306 region means this is a critical juncture.
An hourly close below that level would point towards further downside, where we would come closer to negating the uptrend in play over the past two-months. For that to happen we need to see a break back below 7262. Until then, there is a chance this is just a retracement set within a wider uptrend. Previous occasions of an oversold stochastic with a deep retracement have typically sparked another surge higher. Will we see the same here?