FTSE attempted to fill Monday’s gap on extension of bounce from fresh low at 7179, but rally was so far short-lived, failing to benefit more on bullish signal from yesterday’s Hammer.
Pound’s correction lower provided temporary relief to the index, but prevailing tone on daily chart remains negative and keeps the downside at risk.
We look for today’s close below cracked 55SMA (currently at 7230) for strong bearish signal for fresh attack at 7279 low (also daily cloud top / Fibo 61.8% of 7024/7444 upleg) that marks pivotal point and trigger for further downside.
The price may spend some time in consolidation, with upside attempts expected to hold below 7250 and keep negative near-term structure.
Conversely, extended recovery through 7250/80 pivots would generate initial reversal signal, with lift above 7311 (converged daily Tenkan-sen / Kijun-sen line, still in bullish setup), needed to confirm.
Res: 7231; 7250; 7280; 7311
Sup: 7210; 7179; 7123; 7100