FTSE 100 & CAC 40 Price Outlook:
- The FTSE 100[1] jumped Monday morning, moving toward trendline resistance
- Not to be outdone, the CAC 40[2] shot above 5,000 as it moves within reach of horizontal resistance
- How to Trade FTSE 100[3]
FTSE 100 & CAC 40 Forecast: Stocks Surge to Start the Week, Resistance Eyed
European indices began the week with a roaring start as risk appetite seemingly swept the market, allowing stocks across the Atlantic to begin on a similarly strong foot. The rising tide of equity demand sent the FTSE 100 and CAC 40 rocketing toward technical resistance that has worked to keep both markets contained. While the recent spike may be an encouraging sign for bulls, summer conditions might make it difficult for a confident break out to be posted.
FTSE 100 Forecast
To that end, the FTSE 100 will have to negotiate a few technical barriers before it can look to exit the trading range that it has maintained since early June. First on the list is the nearby descending trendline derived from the index’s June peak – a line that has displayed some influence over price in both July and August. Should it fall, bulls could then set their sights higher, perhaps aiming at the Fibonacci level around 6,225.
FTSE 100 Price Chart: 4 – Hour Time Frame (June 2020 – August 2020)
That said, I am hesitant to suggest the FTSE 100 forecast has changed materially as resistance around 6,300 looms over the index still. A brief attempt higher was punished just two weeks ago, so a break above the level is likely required before the FTSE 100 can establish an attack higher with confidence.
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