In today's technical analysis, let's focus on the British FTSE 100 index, which is currently testing a critical support level. While the long-term global sentiment remains extremely positive, the short-term outlook shows a clear bearish correction taking place. This correction is visible on the FTSE chart, where the index is currently sitting at a significant orange horizontal support.
Recently, the price has already broken one uptrend line, and now it is pressing down on a secondary uptrend line. The pressure on this support is notable, and a potential break below it could trigger further downward momentum. If this support gives way, the price is likely to head towards the black horizontal support level. A confirmed breakout below this lower uptrend line would serve as a strong bearish signal, providing a solid entry point for short positions.
Conversely, if the FTSE manages to hold above these key levels and starts to climb, it could be an excellent signal to buy, suggesting that the current correction may be ending, and buyers are regaining control. Traders should monitor these levels closely for potential breakouts or rebounds that could indicate the next significant move for the index.