Markets rally on bullish momentum…

It appears that positive momentum has helped lift the indices up. With
previous bearish signals been negated are there more rallies ahead?
As important key levels have been breached on the upside the opportunity
for the bulls to lift the indices higher certainly stands a good chance. But
there may be limits on how much further these markets may rise to.

FTSE 100 clears all important 5287…

Having cleared the 5287 level the FTSE 100 index
challenged the 5311 – 5331 level as expected.
Although a bearish Double Top Pattern failed at his
level the pullback to the 20 day moving average sports
a potential reverse head and shoulders pattern. This
would suggest that more upside potential may be at
hand if the 5331 level is cleared sooner rather than
later.

The index would need to maintain above 5090 – 5038
in order to maintain short term bullish moves.

Dow Jones climbs above 10407…

The key reversal at 10407 on July 13th which was a
short term cycle turn date only managed to take the
index lower by a trickle.

Instead the Dow found support at its 20 day moving
average to climb back above the important resistant
level of 10385. If the Dow can sustain support levels
between 10385 – 10200 then the possibility of seeing
the index reach towards 10630 exists. Momentum is
positive supporting short term bullishness.

Crude Oil continues to challenge traders…

Crude oil reached the initial downside support of
$75.00 in last week’s trading.

Currently the commodity has shown no real strength
although we may be on the verge of higher prices if
positive momentum continues. The momentum
indicator has now turned higher. But we have seen
false alerts as of recent. This is due to Oil trading in a
sideways range and requires a thrust before we can
assess the longer term view on this commodity.
Support remains at $75 and upside targets are at the
$80 level.

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Spread Betting and CFD comments by Sandy Jadeja, Chief Technical Analyst, City Index.

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