Trade view /
16 September 2016 at 7:48 GMT
Although the FTSE has been pressured this week, a hint from the Bank of England that another rate cut is likely prompted a reversal of fortunes yesterday.
A Morning Star formation indicates that further upside is expected over the coming days.
The Ichimoku cloud on the daily chart has proved supportive, with negative momentum also stalling.
The shorter time frames (4-hour chart) also have room to move higher before technical resistance attracts swing sellers.
Our long-term bias remains positive, with the reverse head-and-shoulder formation targeting a move to 7,355 points.
Management and risk description
Once the first target is met, move the stop to entry and target second resistance level on any balances.
Entry: Buy UK100 at current levels (6,710 points)
Stop: A break below 6,670 points
Targets: 6,760 and 6,790
Time horizon: 1-2 days
UK100 daily chart showing Morning Star formation
UK100 long-term weekly chart with reverse head-and-shoulder target
Source: Saxo Bank
— Edited by John Acher
Non-independent investment research disclaimer applies. Read more