The FTSE 100 is flirting with a potential double top at 9,950 as markets reopen after Christmas. While a bullish ascending triangle could be building on the 4-hour chart, heavy pressure on defence stocks amid new Ukraine peace talks is creating a battle between a breakout to 10,000 and a correction back to 9,600.
In this video, we break down the macro headwinds hitting BAE Systems and Babcock as investors price in de-escalation risks. Then, we map out the technical tug-of-war: a bullish continuation toward the psychological 10k mark versus a bearish double-top reversal targeting 9,770 and lower.
Key drivers
Defence sector drag: Reports of positive peace talks between Trump and Zelenskyy have triggered profit-taking in defence majors, weighing on the index. However, rotation into defensive sectors like pharmaceuticals is keeping the FTSE relatively stable.
Double top vs. ascending triangle: Price stalled again at the 9,950 record high, forming a double top. Yet, higher lows on the 4-hour chart suggest an ascending triangle—a continuation pattern that could fuel a breakout.
RSI divergence: The 4-hour RSI is showing bearish divergence and drifting toward the 50 line, signalling waning momentum. A reset to 30 could coincide with a deeper pullback if support fails.
Key levels:
Trade plan:
Are you betting on the 10k breakout or fading the double top? Share your FTSE strategy in the comments and follow for more market updates.
This content is not directed to residents of the EU or UK. Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice. ThinkMarkets will not accept liability for any loss or damage including, without limitation, to any loss of profit which may arise directly or indirectly from use of or reliance on such information.
In this video, we break down the macro headwinds hitting BAE Systems and Babcock as investors price in de-escalation risks. Then, we map out the technical tug-of-war: a bullish continuation toward the psychological 10k mark versus a bearish double-top reversal targeting 9,770 and lower.
Key drivers
Defence sector drag: Reports of positive peace talks between Trump and Zelenskyy have triggered profit-taking in defence majors, weighing on the index. However, rotation into defensive sectors like pharmaceuticals is keeping the FTSE relatively stable.
Double top vs. ascending triangle: Price stalled again at the 9,950 record high, forming a double top. Yet, higher lows on the 4-hour chart suggest an ascending triangle—a continuation pattern that could fuel a breakout.
RSI divergence: The 4-hour RSI is showing bearish divergence and drifting toward the 50 line, signalling waning momentum. A reset to 30 could coincide with a deeper pullback if support fails.
Key levels:
- Upside: A break above 9,950 targets the psychological 10,000 barrier.
- Downside: Immediate support lies at 9,850. Below that, 9,770 is crucial structure. Losing 9,620 and finally 9,440 would confirm a trend reversal.
Trade plan:
- Bearish: Sell a breakdown below 9,850 targeting 9,770 and 9,620.
- Bullish: Buy a break above 9,950 targeting 10k, but beware of limited upside compared to downside risk at these levels.
Are you betting on the 10k breakout or fading the double top? Share your FTSE strategy in the comments and follow for more market updates.
This content is not directed to residents of the EU or UK. Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice. ThinkMarkets will not accept liability for any loss or damage including, without limitation, to any loss of profit which may arise directly or indirectly from use of or reliance on such information.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.