FTSE 100 on the Verge of a Bearish Reversal

Market Analysis – June 14

The FTSE 100 appears poised for a bearish reversal as it struggles to maintain its upward trajectory. The index recently dipped into the demand zone at 8120.0 but failed to rise to the significant high of 8400.0. A second retest of this demand zone has weakened it, increasing the likelihood of a breach.

FTSE 100 Key Levels:

• Demand Levels: 8120.0, 8015.0, 7790.0
• Supply Levels: 8450.0, 8500.0

FTSE 100 Long-term Trend: Bullish

The FTSE 100’s bullish momentum has noticeably waned. Throughout May, there was a consistent and gradual decline in the size of daily candles as the price approached 8450.0. After hitting this level, the midget daily candles showed sideways movement, indicating a lack of bullish energy. This loss of momentum was reflected in the Awesome Oscillator, which turned red. Subsequently, larger bearish candles led to a sharp decline to 8120.0.

Currently, the Awesome Oscillator remains negative, with larger red bars indicating a continued decline in bullish momentum. The double retest of the 8120.0 demand zone is a negative signal for the uptrend, and the price has fallen below the 30 and 50-period moving averages.

FTSE 100 Short-term Trend: Bearish

In the 4-hour timeframe, the FTSE 100 has established a bearish market structure. Despite this, buyers can still regain momentum. However, it is prudent to confirm a bearish trend only upon a bearish structure shift in the higher timeframe.

In conclusion, while the long-term trend remains bullish, the FTSE 100 is showing signs of a potential bearish reversal. Investors should closely monitor key levels and market signals to navigate this evolving market situation.

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