Market Forecast 06/10/2017
FTSE 100 recovered well and now trading above 7,400. SPX 500 spiked above 2520 and eyeing more gains in the near term.
FTSE 100 Index Forecast – Back In Bullish Zone:
- The FTSE 100 index after forming a bottom at 7200 started an upside move towards 7500.
- There is a major bullish trend line forming with support at 7380 on the 4-hours chart of FTSE 100 Index.
- Today in the UK, the Halifax House Price Index for Sep 2017 was released by the HBOS.
- The forecast was slated for +0.1%, but the actual was better as the Halifax House Price Index rose 0.8%.
The FTSE 100 index after a sharp decline towards the 7200 support zone found buyers. The index formed a base near 7200 and later started an upside move.
It surged higher and broke many resistances such as 7300 and 7400. There was a close above the 7400 resistance and the 100 simple moving average (H4), which is a positive sign.
The index even broke the 7500 handle and traded as high as 7528. At the moment, it seems like there is a chance of a downside correction towards 7480. An initial support is around the 23.6% Fib retracement level of the last wave from the 7355 low to 7528 high.
On the downside, the next major support is near 7460 and the 50% Fib retracement level of the last wave from the 7355 low to 7528 high. Moreover, there is a major bullish trend line forming with support at 7380 on the 4-hours chart of FTSE 100 Index.
Overall, buying dips in the near term can be considered near the 7440 level.
UK’s Halifax House Price Index
Today in the UK, the Halifax House Price Index for Sep 2017 was released by the HBOS. The forecast was slated for an increase of 0.1% in the index compared with the previous month.
However, the actual result was better as the Halifax House Price Index rose 0.8%, but it was less than the last revised reading of 1.5%. Looking at the 3month to yearly change, there was a rise of 4%, which was better than the forecast of +3.6% and above the last +2.6%.
SPX 500 Index Forecast – Crucial Resistance Break?
- The SPX 500 Index continues to gain momentum and already above the 2520 level.
- There are two bullish trend lines forming with support at 2545 and 2535 on the 4-hours chart of the SPX 500 Index.
In the last few analysis, we pointed out more gains chances in the SPX 500 Index above the 2,500 level. The index gained pace recently and moved above the 2,520 level.
The upside move was strong as the index moved above 2,550 and formed a high at 2,554. At the moment, the index is correcting lower towards 2,540. On the downside, there are two bullish trend lines forming with support at 2545 and 2535 on the 4-hours chart.
As long as the index is above the 2,540 and 2,520 support levels, one can consider buying with a tight stop.
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