Originally published by AxiTrader
Fighting this developed world global stock market rally has been fraught with danger in pretty much every jurisdiction other than Australia recently.
Now it's the very essence of a bull market when the focus is on positives to the exclusion of almost anything negative. As a result, bearishness has been rewarded with losses. And even though there are signs of imbalances across markets the bulls have the whip hand as the buy-the-dip crowd re-enters at every opportunity. Periods of sideways trading have given way to gains, and then new highs.
So it's been in US markets and so it is in the FTSE.
After making another record high recently the FTSE has pulled back for the past three weeks and is approaching important support.
At 7363 price is currently resting on my fast moving average and the midpoint of the Bollinger Band on this time frame. But it has slipped back below the 7380 region which was the previous range top and is now looking biased back toward the trendline support from the start of the Trump rally back last November.
That level is still some distance away at 7,241 and a break of this month's low at 7,313 would be required to open up a move to that lower level.
And without getting uber-bearish the combination that is my systematic approach suggests a move back to test the line with a chance of a fall to the 38.2% retracement level of the Trumponomics rally at 7,167.
Price would have to move back above 7,500 to negate this outlook short term.
Here's the weekly chart:
Have a great day's trading.