FTSE 100, in its hourly chart, shows the corrective process after the 3--day rally, which drove it to an over 15% increase. The last upward impulsive sequence began on Monday 23rd, once FTSE 100 found buyers at 4,762.2 pts, which was its lowest level since August 2011.
The corrective sequence that the British index is developing seems similar to the first internal leg of a three-wave formation. The FTSE 100 index likely will complete its corrective structure near the 5,200 level, which corresponds to the previous key resistance level.
However, our main perspective points to an entry in the long-side, expecting the progress of a second upward impulsive sequence.
A bullish position will activate if the price rises and closes above 5,694.8 pts. In our conservative scenario, we expect an upward move to 5,928.7 pts. If the British index extends its bullish momentum, the price could advance until 6,217.9 pts, and even soar till 6,479.3 pts.
The level that invalidates our bullish scenario locates at 5,366.3 pts.
Trading Plan Summary
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Entry Level: 5,694.8 pts.
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Protective Stop: 5,366.3 pts.
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1st Profit Target: 5,928.7 pts.
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2nd Profit Target: 6,217.9 pts.
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3rd Profit Target: 6,479.3 pts.
Risk Warning: CFD and Spot Forex trading both come with a high degree of risk. You must be prepared to sustain a total loss of any funds deposited with us, as well as any additional losses, charges, or other costs we incur in recovering any payment from you. Given the possibility of losing more than your entire investment, speculation in certain investments should only be conducted with risk capital funds that if lost will not significantly affect your personal or institution’s financial well-being. Before deciding to trade the products offered by us, you should carefully consider your objectives, financial situation, needs and level of experience. You should also be aware of all the risks associated with trading on margin.
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