Technical Analysis – UK 100 index’s picture dampens after record high above 8,000
February 21, 2023 9:28 am
The UK 100 index gained significant buying traction above 8,000 in the previous week, with the price quickly returning lower and posting a sideways move in the short-term.
The negative slope in the RSI and the falling MACD are endorsing the current neutral-to-bearish momentum in the price, though with the former nearing its 70 overbought level suggesting an overstretched market, the bears could be around the corner.
A decisive close above the 8,000 psychological mark could reduce negative risks, producing another bullish extension towards the next key levels such as 8,100 and 8,200.
Otherwise, if sellers take the lead, the index may pull back to test the nearby support of 7,885. Falling lower, the 20-day simple moving average (SMA) at 7,858 and the medium-term uptrend line near 7,800 may attempt to add some footing around the 50-day SMA at 7,700, while not far below, the 7,680 support could block the way towards the 7,540.
In brief, the UK 100 index is strengthening its bullish trend in the medium-term picture, but some caution is warranted as the price is easing in the very short-term.
The UK 100 index gained significant buying traction above 8,000 in the previous week, with the price quickly returning lower and posting a sideways move in the short-term.
The negative slope in the RSI and the falling MACD are endorsing the current neutral-to-bearish momentum in the price, though with the former nearing its 70 overbought level suggesting an overstretched market, the bears could be around the corner.
A decisive close above the 8,000 psychological mark could reduce negative risks, producing another bullish extension towards the next key levels such as 8,100 and 8,200.
Otherwise, if sellers take the lead, the index may pull back to test the nearby support of 7,885. Falling lower, the 20-day simple moving average (SMA) at 7,858 and the medium-term uptrend line near 7,800 may attempt to add some footing around the 50-day SMA at 7,700, while not far below, the 7,680 support could block the way towards the 7,540.
In brief, the UK 100 index is strengthening its bullish trend in the medium-term picture, but some caution is warranted as the price is easing in the very short-term.
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