FTSE finds buyers again around 6994.78
FTSE 100 Index (FTSE) Technical Analysis Report for Oct 12, 2018 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, FTSE finished the week -4.41% lower at 6995.91 after losing £10.99 (-0.16%) today. Today's close at 6995.91 marks the lowest recorded closing price since March 26th. Trading £67.06 higher after the open, FTSE 100 was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on September 18th, FTSE actually gained 0.42% on the following trading day. Closing below Thursday's low at 6998.00, the index confirmed its breakout through the previous session low after trading up to £3.22 below it intraday.
Daily Candlestick Chart (FTSE as at Oct 12, 2018):
Friday's trading range has been £79.21 (1.13%), that's slightly above the last trading month's daily average range of £71.54. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently strongly higher than usual for FTSE.
After having been unable to move lower than 6998.00 in the prior session, the Footsie found buyers again around the same price level today at 6994.78.
With another close below the lower Bollinger Band, prices are confirming their strong downward momentum in the short-term. A rally back into the Bollinger Band on the next trading day while might signal a potential change in momentum that could lead to a correction back up towards the center of the Bollinger Bands at 7358.04.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
With prices trading close to this year's low at 6866.90, downside momentum might speed up should the stock index break out to new lows for the year.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "3 Consecutive Lower Closes" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for FTSE 100. Out of 150 times, FTSE closed higher 56.67% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 60.00% with an average market move of 0.60%.
With three out of the other five Major European Indices closing lower today, the ones that stand out on the negative side are CAC losing -0.2% and N100 closing -0.15% lower. On the flipside the best performers have been TECDAX closing 1.47% higher and BEL20 gaining 0.06%. Read more