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FTSE 100 Big Bear Outside Bar in Middle of TR

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Market Overview: FTSE 100 Futures

The FTSE futures market moved down last week with a bear outside bar. That means we triggered buyers above after a bull microchannel in the middle of a trading range. There were buyers again at the 200-week MA. It might be difficult for bears to sell through it. This week is now a bad buy and a bad sell signal, so we might go sideways next week.

FTSE 100 Futures

The Weekly FTSE chart

FTSE 100 Bear Outside Bar in Middle of TR
FTSE 100 Bear Outside Bar in Middle of TR
  • The FTSE 100 futures was a bear outside bar last week.
  • It triggered the buyers above a bull microchannel.
  • The bull leg was strong, so we should get a second leg sideways to up. But the outside bar is disappointing, so it might be just one bull bar up to the trigger point.
  • The bulls see an HL DB, a wedge bottom after a bull BO to a new ATH.
  • They bought again near the 200-week MA; as all MAs are moving up, it is a bull trend.
  • Bull trends encourage bulls to buy high, knowing they can buy lower if it forms a trading range and at least get out breakeven if disappointed.
  • The bears see a trading range and failed BO above a TR. The bear legs have been too strong to call it a bull trend, so they will sell above the highs.
  • There is a LH and a HL – so it’s a triangle, and we are right in the middle, which might be where we stay for the next few weeks.
  • The bulls broke to a new high and bought pullback. The pullback was strong but failed at the MA – trapping them in.
  • The bears could not run the bull stops, so we strongly reversed back to where they got stuck.
  • Last week you can see they exited out of that position.
  • Some aggressive bears shorted the bull microchannel because it was a BO from an inside bar, which is a reasonable fade trade.
  • Consecutive bars closed above the MA, but a 20-bar MA gap bar sell worked.
  • It’s a weak sell signal low in a trading range, so there are probably more buyers below.
  • Expect sideways to up next week.

The Daily FTSE chart

FTSE 100 Gap Closed, Testing BO Point and MA
FTSE 100 Gap Closed, Testing BO Point and MA
  • The FTSE 100 futures last week was small bull bar closing on its high, so we might gap up on Monday.
  • The bulls closed the gap above after a strong BO from a bear channel. The trendline break was strong and did not allow bears to exit breakeven.
  • Bears selling the MA also sold and got trapped. Both could exit on Thursday with that big tail.
  • The bull leg was very strong, so traders will expect a small leg sideways to up.
  • But the bear selloff was surprising as well – so they might get one more bar down.
  • Now bulls are trapped above at the BO point and MA. Bulls want to move up quickly to let them out.
  • The last bears are stuck on July 17th with a bear bar a reasonable sell signal at the MA. The trouble with that sell was it was late in a bear trend so most traders should not take it.
  • We are behaving like a trading range, so traders should BLSHS and take quick profits.
  • It is a bear outside bar on the weekly, so trading range behaviour and likely sellers above now.
  • Friday was a small bar, so we will likely go above and below it. Most traders should wait for consecutive bull bars before buying.
  • Now we are below the moving average, so we might go sideways for 2 more days before traders decide where to next.
  • Bears might exit above this Friday’s bar. But it is too early to buy.
  • Expect sideways to down next week.

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