The UK 100 Index or the FTSE 100 as it is heavily based off is winding up and has formed an inside bar on the daily price action chart. Over the past few days price has been winding up tighter and tighter with price stalling at it’s current position, looking to build the order flow it needs to make the next large move.
This is a super common market rule or market pattern that is repeated time and time again and as I go through in the price action trading lesson Price Action Guide to How the Market Moves price never moves in straight lines and has to make retracements and pauses within moves higher or lower. This is what gives us our high probability opportunities to get into reversal trigger signal setups.
As we can see from the daily chart below; price had been in a strong move higher. Price then was tested at the resistance level, before bursting on higher with the strong momentum to move and close above. The resistance then looked to hold as an old resistance and new price flip support level.
Price is now sitting just above this very important new support level with the new inside bar having just been formed on the daily chart showing that neither the bulls or bears (buyers and sellers) have clear control at this stage. If price can breakout higher of the housing candle, then it would be trading with a lot of the strong bullish momentum and also away from the strong daily support area.
UK 100 Daily Chart Zoomed Out
UK 100 Daily Chart Inside Bar
Note: I am sorry that both yesterdays and today’s trade setups commentary are posted up late for you. My 6 year old son Charlie had an accident at the start of the week where his friend fell from a bunk bed whilst they were playing. He broke his arm and had to spend a couple of nights in hospital. He is okay and now back up and running around, but I have just been looking after him which has meant I have not been able to make the posts as early as I would have liked for you. I will be back to normal next week and posting soon after the New York daily candle closes.
The other thing is; I am about to publish a super cool lesson in the next couple of days so keep an eye out!!
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