FTSE 100 Index Price Forecast October 16, 2017, Technical Analysis
The FTSE 100 rallied a bit during the day on Friday, after initially dropping down to the 7520 level. The market should continue to reach higher, aiming for the 7550 handle, and then perhaps reaching towards the 7600 level. I believe that the market continues to find buyers on dips, as the FTSE 100 broke above the 7500 level previously, which was a massive barrier. Ultimately, this is a market that I think will continue to find buyers as the British pound, although strengthening lately, the British pound will continue to be cheap, thereby making British exports very competitive. Remember, the FTSE 100 is full of exporting companies out of the United Kingdom, so therefore the 2 lined up nicely.
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I believe that the market is going to continue towards the 8000 level over the longer term, and the dips continue to offer value the people will take advantage of. Ultimately, the FTSE 100 will perform well as the British economy is stronger than once thought, so therefore I see this working out quite nicely on several different levels. That being said, I remain bullish and have no interest in trying to fight this rally. However, if we break down below the 7450 level, that would change the overall attitude of the market, and then I think a real strong support level at the 7400 level would then be targeted. A breakdown below that would change the absolute trend, thereby making the FTSE 100 a market that you sell, not by. However, I don’t think anytime soon we will see this, and therefore I think that the markets will remain “buy only” in the foreseeable future, even though we may have noise occasionally. I still believe we are going to reach towards the 8000 level, but that is probably something we will see at the end of the year, perhaps even spring of 2018.