The UK100 Index, on the H4 chart, was in a downward path until the 3rd of June when a lower bottom was recorded at 7081.2. Demand overwhelmed supply and the downward momentum was interrupted.
After the bottom at 7081.2, the market broke through the 15 and 34 Simple Moving Averages and the Momentum Oscillator pierced the zero baseline into positive territory. These two indicators in conjunction with an Engulfing Candle pattern together confirmed a possible technical reversal in progress.
A likely critical resistance level formed when the higher top was recorded at 7263.1 on the 5th of June. Sellers then currently tried to pull the market lower but the possibility of a reversal has been strengthened even further by the crossing of the 15 and 34 Simple Moving Averages, called a Golden Cross.
If the UK100 Index breaks through the critical resistance level at 7263.1 then three possible price targets may be projected from there. Attaching the Fibonacci tool to the top of the possible reversal at 7263.1 and dragging it to a possible support level at the 34 Simple Moving Average at 7185.9, the following targets may be calculated. The first target can be anticipated at 7310.8 (161 %). The second price target can be predicted at 7388.0 (261.8%) and the third and final target may be expected at 7512.9 (423.6%).
If the support level at 7185.9 is broken, the possible scenario is invalidated and will need to be re-evaluated.
As long as buyers maintain a positive sentiment and demand overcomes supply, the outlook for the UK100 Index on the H4 time-frame will remain bullish.
After the bottom at 7081.2, the market broke through the 15 and 34 Simple Moving Averages and the Momentum Oscillator pierced the zero baseline into positive territory. These two indicators in conjunction with an Engulfing Candle pattern together confirmed a possible technical reversal in progress.
A likely critical resistance level formed when the higher top was recorded at 7263.1 on the 5th of June. Sellers then currently tried to pull the market lower but the possibility of a reversal has been strengthened even further by the crossing of the 15 and 34 Simple Moving Averages, called a Golden Cross.
If the UK100 Index breaks through the critical resistance level at 7263.1 then three possible price targets may be projected from there. Attaching the Fibonacci tool to the top of the possible reversal at 7263.1 and dragging it to a possible support level at the 34 Simple Moving Average at 7185.9, the following targets may be calculated. The first target can be anticipated at 7310.8 (161 %). The second price target can be predicted at 7388.0 (261.8%) and the third and final target may be expected at 7512.9 (423.6%).
If the support level at 7185.9 is broken, the possible scenario is invalidated and will need to be re-evaluated.
As long as buyers maintain a positive sentiment and demand overcomes supply, the outlook for the UK100 Index on the H4 time-frame will remain bullish.