A Hammer at last week’s base has left this week’s signals for FTSE 100 sentiment pointing temporarily higher. However, as a near 350 Pt rally since last week’s 13 month low had left intraday sentiment overstretched near last week’s high, Wednesday’s signals pointed to buying the dip.
Although this was initially the correct strategy, as initial losses of 36 ½ Pts were completely recovered, renewed selling the New York time-zone has seen sentiment close modestly lower on the day. This has weakened sentiment and coming from last week’s high, the outlook for Thursday is close out weekly long balances and to sell on the open and at 6360.0, with a stop loss at 6384.5.0, yesterday and last week’s high trades.
Targets are to 6311.0/16.0, yesterday’s low, 6270.0 and 6213.5, a 50% pullback to the gains posted since last week’s low trade.
