Daily Indices Update: United Kingdom 100 (UK100) |
By, James A. Hyerczyk
Following a prolonged move to the downside in terms of price and time, the United Kingdom 100 (UK100) index CFD reached an oversold level, triggering a quick turnaround. The channel down chart pattern that formed on the 30-minute chart with a top at the resistance level at 5470.24 became an emerging pattern when the market made its final bottom on the support level at 5366.80.
The quality of the chart pattern is 6-bars. The 8-bar initial trend rating is a solid indication that the market could move higher especially since Autochartist has identified this as a continuation move. The purpose of the initial trend is to measure the strength of the trend prior to the formation of the pattern. The uniformity indicator looks for equidistant tops and bottoms as well as measuring the strength of the touches of the support and resistance levels. This indicator is rated an average 5-bars. The clarity indicator is also rated 5-bars. This means the pattern was created with an average amount of “gaps” and “spikes”.
The channel down chart pattern is a trending pattern. The initial trend was up at the onset of the pattern. The index CFD drifted low while inside of the channel down, however, the fast reversal has put the market back on track for a rally. Based on the short-term range of 5366.80 to 5470.24, traders should look for early resistance at the minor retracement zone identified as 5418.52 to 5430.73. If the market can clear this zone then traders should watch for a possible breakout above the resistance level.
About the author: Autochartist
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