FTSE closes lower for the 2nd day in a row
FTSE 100 Index (FTSE) Technical Analysis Report for Aug 23, 2019 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, FTSE finished the week -0.31% lower at 7094.98 after losing £33.22 (-0.47%) today ahead of tomorrow's Summer Bank Holiday. Trading £60.41 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 Tuesday, FTSE actually gained 1.11% on the following trading day. Closing below Thursday's low at 7103.70, the market confirmed its breakout through the prior session low after trading up to £8.72 below it intraday.
Daily Candlestick Chart (FTSE as at Aug 23, 2019):
Friday's trading range has been £93.61 (1.31%), that's slightly below the last trading month's daily average range of £107.55. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently notably higher than usual for FTSE.
Prices are trading close to the key technical support level at 7079.70 (S1). After having been unable to move lower than 7103.70 in the previous session, the index found buyers again around the same price level today at 7094.98.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Selling might speed up should prices move below the nearby swing low at 7020.20 where further sell stops could get activated.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Low close to prior low" stand out. Its common bullish interpretation has been confirmed for FTSE 100. Out of 504 times, FTSE closed higher 53.17% 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 57.14% with an average market move of 0.22%.
With five out of the other five Major European Indices closing lower today, the ones that stand out on the negative side are DAX losing -1.15% and CAC closing -1.14% lower. None of the markets managed to end the day in the green. Read more