This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material 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. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
FTSE 100 rebounding after wedge breakdown
The FTSE 100 sold off sharply following a double top formation completed on Tuesday. That has taken us into the 76.4% retracement at 7481. The subsequent rally has provided a bearish wedge, which has now been broken.
The 7481 low is going to be crucial from here, with a move back below that level greatly increasing the chance that we will see the price move back down through 7448. As such, the outlook is somewhat mixed for now, where the respect of the Fibonacci level points towards a possible resurgence. However, the near-term wedge signals that we could see some near-term weakness.