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Could trendline resistance put a stop to FTSE rally?
The past week has seen almost 500 points of upside in the FTSE, managing to create a new 47-day high yesterday. However, the price appears to be showing possible signs that we are due a move lower, in a bid to take back some of those gains. Yesterday saw the price reverse lower from an ascending trendline from late August, posting a shooting star candle.
The price has subsequently moved down to near-term support at 6315 which is joined by another near support level at 6298 (September high). Should it move through these two levels, I would become more confident that we are going to see another move lower towards 6250 and 6123 support levels. Should we see that downside move, I would become progressively more convinced as it moves through 6276 and 6255. Ultimately any selloff could quite easily take us back to 6070 or 6023, but we are awaiting further signals that this is truly that top.