Published On: Tue, Mar 14th, 2017

FTSE eyes all-time highs

InstaForex

Day trade

/

Buy

Trade view / 41 minutes ago

Director / PIA First

United Kingdom

Instrument:UK100.I

Price target:7,500

Market price:7,378

Background


The FTSE 100 index (UK100.i) gained some support from a recovery in the resources sector and expectations of further merger-related activity with a gain of 0.34%. A stronger dollar should assist in the upward potential. Even after Scottish first minister Nicola Sturgeon announced her intention to trigger a second independence referendum, prices bounced back from an initial dip.

Our medium-term bias remains bullish as we trade close to all-time highs (7,400) and we expect gains through here to eventually target the psychological 7,500 area.

After posting a bullish hammer (March 9) price action has resulted in a move higher towards resistance. Momentum is strong and a break of the highs looks likely whilst Elliott Wave formations continue to target a fifth wave move higher.

Parameters

Entry: buy UK100.i at current levels and add on a break of 7,400.

Stop: a break below 7,320.

Target: 7,500 (psychological) and 7,565 (127.2% Fibonacci extension)

Time horizon: one or two days.

Four-hour chart with all-time high barrier:

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Source: Saxo Bank

Daily chart with trend support intact:

Source: Saxo Bank

Weekly chart highlighting Elliott Wave and Fibonacci targets:

Source: Saxo Bank

— Edited by Michael McKenna

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