Friday ended on a bit of a weak one, not helped by North Korea test firing another missile that landed in Japan’s territorial waters. The FTSE 100 dipped below the 7400 level to a low of 7341 (I had mentioned 7340 in passing in the email as decent looking support but didn’t think it was going to be tested!) but has since fought back a little bit to sit around the 7375 level. Last day of the trading month today so not usually the strongest day, plus we head into August which is traditionally the weakest month. Can they deliver a bull Monday?
Asian raw-material producers advanced after a surge in commodity prices bolstered optimism the global economy can gather momentum. Oil extended last week¹s strongest rally this year.
FTSE 100 Outlook and Prediction
After a weak Friday will we get Bull Monday again? We didn’t last week but the omens look good for a rise towards the 7425 area where there are several resistance levels of note, the main one being resistance on the daily chart. We also have the 2 hour coral line at 7430 which is likely to see some action from the bears.
The bulls have fought back from Fridays low at the 7340 level, and this area is support for today, and we also have a key fib level here, as well as S1 at 7338. The Bianca channels are slightly higher with the 10 day bottom at 7350.
As such I can see a rise towards the 7425 level today, and it will be at this level that things get interesting. Will the bears re appear or are the bulls still in charge and this dip was just another wobble in the uptrend? We are testing the bottom of the daily channels at the moment so only a break of 7320 (10 day Raff) will make things look bearish. There are some definite signs appearing for some weakness to 7200.
However, if the bulls can break above that 7430 level then we should see 7480 and then we can start to think about 7515 and 7580 again.