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FTSE respects trendline to bounce higher
Yesterday’s selloff caught a significant bounce overnight, which brings into play a possible near-term recovery of a similar ilk of that seen in early and late July. The bullish engulfing pattern evident on the four-hour chart provides a more positive outlook for the time being, but the key resistance is yet to come in this recovery with a range of lower shadow bottoms between 6635 and 6650. Thus while things look relatively bullish given the size of this bounce, I would be hesitant to call for further significant gains until the price moves above the 6650 mark. A move above this level would bring a target around 6720 (the top end of the symmetrical triangle).