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FTSE weakness looks temporary
Yesterday saw the FTSE continue to grind lower, with Friday’s support level of 6388 providing new resistance to cap yesterday’s move lower. This looks a lot like a short-term phenomenon for now and I would need to see the price break back below 6300 to gain confidence that we are actually seeing a selloff of substance.
For today, I would expect a resumption of the bullish trend should the price break back above 6388 in the near future without breaking below 6350 first. However, further short-term downside is certainly a possibility, and given the fact that all previous retracements have seen long lower shadows for the candle that ultimately marks the bottom, I would like to see this happen again.
Overall I am bullish unless the price moves below 6300, with 6344 support and 6388/6455 resistance providing my levels to watch in the short term.