The FTSE 100 fell initially on Monday, but found enough support underneath to continue to go higher and eventually break above the recent consolidation. The fact that we have broken out above the 7425 handle and then pulled back to test it for support suggests to me that we are going to continue to go higher. Because of this, I like the idea of buying these dips, and I believe that we will eventually go looking for the 7500 level. The British pound has strengthened as of late, and that of course works against the value of exports, which has a knock-on effect over here, but in the end, I believe it’s very likely that we will see buyers enter the FTSE 100 on dips.
Buying dips aiming for 7500
The most obvious strategy is to simply add to your position every time the market dips and find support, and aiming for the 7500 level. That’s a very large, round, psychologically significant number, and I believe it’s only a matter of time before rising. Beyond that, I think we go above the 7500 level and then go looking for 7600. I don’t have any interest in shorting, quite frankly it appears that most stock indices around the world look very bullish, and I believe it’s going to show itself here. I believe that given enough time, the buyers will flex their muscles every time value appears. I have no interest in shorting this market until we break down below the 7350 level underneath, something that looks a little bit less likely after today’s trading action. Because of this, I remain optimistic and realize that people will be returning to the FTSE 100 after a very choppy last few several sessions.
FTSE 100 Video 20.7.17
This article was originally posted on FX Empire