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FTSE pulling back as recovery moves towards crucial resistance level
The FTSE 100 resurgence has continued apace today, rising to a two-week high in the early hours. With price having regained a substantial amount of the losses from mid-September, the big question is whether we can see a move back above 6300, which would take us out of this consolidation phase and into a more bullish mindset.
For now, we have seen a bearish engulfing candlestick pattern, accompanied by bearish positioned stochastic and MACD indicators. Given the size of the rise we have seen, it makes sense that some sort of pullback were to occur for now. The downside support level to initially watch is 6208, which if broken would point to a move back to 6174.
As long as price remains above 6208, this chart continues to look bullish yet it is worth noting that until we move back above 6300, there is a strong chance we could see the index turn sharply lower from the upper end of this 5878-6300 range. Thus any bullish sentiment would only hold until 6300, at which point we would have to see how price responds.