FTSE 100 Price Forecast January 25, 2018, Technical Analysis

The FTSE 100 broke down significantly during the trading session on Wednesday, slicing below the 7700 handle handily. By doing so, the market looks likely to break down a bit further, and we did in fact see a lot of selling pressure. I believe that the market should continue to be very noisy, perhaps reaching down to the 7600-level underneath which is massive support. A breakdown below there sends the market down to the 7500 level, which would define the trend to the upside as far as I see. If we break down below there, it would be time to start selling, because quite frankly, it would have been far too severe of a breakdown to continue.

If we do rally, I need to see the market break above the 7750 level to start buying again, or some type of large-screen candle with significant volume. That point, I can be convinced to start buying the FTSE 100 again, but it’s obvious that the damage that was done during the Wednesday session is to be taken seriously. I would anticipate a significant amount of volatility at the very least, and more bearish pressure at the worst. The British pound has rallied rather significantly, and that of course is putting pressure on the FTSE 100 as it makes exports from the UK much more expensive and therefore not as competitive. There is no sign of the British pound falling at this point, so that could continue to be a bit of a thorn in the side of the bullish footsie traders.

FTSE 100 Video 25.01.18