FTSE still stuck within tight trading range
FTSE 100 Index (FTSE) Technical Analysis Report for Jul 02, 2020 | by Techniquant Editorial Team
FTSE ended Thursday at 6240.36 gaining £82.36 (1.34%). The bulls were in full control today, moving the market higher throughout the whole session. Closing above Wednesday's high at 6202.00, the index confirmed its breakout through the previous session high after trading up to £56.60 above it intraday.
Daily Candlestick Chart (FTSE as at Jul 02, 2020):
Thursday's trading range has been £100.64 (1.63%), that's below the last trading month's daily average range of £132.35. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for FTSE. Prices continued to consolidate within a tight trading range between 6084.50 and 6262.10 where it has been caught now for the whole last trading week.
Despite a weak opening FTSE 100 managed to close above the prior day's open and close, forming a bullish Engulfing Candle. Additionally, one bullish candlestick pattern matches today's price action, the White Candle. The last time a White Candle showed up on Monday, FTSE actually lost -0.90% on the following trading day.
The market managed to close back above the 20-day moving average at 6233.49 for the first time since June 23rd. Prices are trading close to the key technical resistance level at 6309.70 (R1).
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying could speed up should prices move above the nearby swing high at 6262.10 where further buy stops might get activated.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Decisive Up Move" stand out. Its common bullish interpretation has been confirmed for FTSE 100. Out of 512 times, FTSE closed higher 54.69% 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 three trading days, showing a win rate of 54.49% with an average market move of 0.09%.
With five out of the other five Major European Indices closing higher today, the ones that stand out on the positive side are DAX gaining 2.84% and CAC closing 2.49% higher. None of the markets ended the day in the red. Read more