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The FTSE 100 has pulled back from its 7420 6-week highs, consolidating its 4.8% bounce from recent 7080 lows. This puts it in a shorter-term falling channel, one which bulls will hope proves a bullish flag that sends it 4.8% higher, to challenge – perhaps even exceed – April’s 7528 peak.
Nonetheless, watch for that intersecting upward sloping trendline, which could prove a technical hurdle. Trade tensions and geopolitics in the oil universe could also influence the FTSE’s open come Monday morning. Don’t forget its impact on the Mining space and higher oil prices pressure on input costs for consumers.
Bulls need a break above 7380 falling highs to escape the channel and confirm a bullish flag towards 7530 (+2.5%).
Bears require a breach of 7320 to exit the channel to the downside, extending the reversal towards 7191 (-2%).
Our watch levels: Bullish 7380, Bearish 7320
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