FTSE: Can The Bulls Break 7300?

The FTSE 100 was up 54.80 to 7277.62 at the close. The index rose for a third straight session, being boosted by consumer goods company Reckitt Benckiser (LON:RKT) after it lifted its sales forecast.

Meanwhile, Wall Street pushed into record territory as a host of tech firms prepared to announce their results. The S&P 500 and Dow both powered to new intra-day highs as the opening bell rang after having closed at record levels on Monday.

The S&P was rather slow to react at the 4590 resistance level initially suggesting the bears are a bit cautious still, though we did get a pullback eventually. It hasn't dropped much though overnight and with decent looking support at 4553 today we may well see the bulls continue to stay in control. They will need to break above the 2h resistance level at 4585 though to push higher. As such we may well see a dip and rise play out today.

That pattern also fits with the FTSE100 charts which have decent looking support at the 7241 level with S1 and the 200ema here on the 30min chart. The 2h Hull MA is also here though it won't be the first test (so not the strongest) it may still garner a reaction. If the bulls can defend this level then I feel that we will be back up towards the 7300 level fairly easily, and possibly higher as the key fib for today is at 7311. It will certainly give the bulls a boost to break above 7300.

There are still a lot of people holding shorts from much lower down (around the 7000 level) based on the client sentiment indicators, and we may well see the FTSE100 continue this bear squeeze for a bit longer.

So initial resistance is at yesterdays high at the 7285 level and we could see a drop straight from here, down to the key support at 7240. Below that 7216 is the key fib and the next level of note, with 7156 below that. I don't think it's going to get mega bearish today but we shall see. 

Above 7285 then 7311 as mentioned, and above that the bulls will be looking to 7350 - we have R3 here and it's also just below the top of the 10d Raff channels. Will they have that much strength today? If the S&P bulls have their way then it's distinctly possible. 

I have put the short order at the key fib just in case we get an initial overshoot of the 7285 level to start with but this whole area (7285-7311) is decent resistance and with R1 at 7294 in the mix any shorts around here should yield initially. 

I am looking for the S&P to defend the 4550 level but if that breaks then we may well see some more sustained selling over the next few sessions, but for the moment the bulls remain in charge. 

Good luck today!