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FTSE is going to break lower and suffer significant losses at some point

ByCarol Harmer
Published 12/13/2011, 07:05 AM
FTSE:FTSE erased Friday’s gains to reach 5415/10.

Sooner or later this market is going to break lower and suffer significant losses! For today we can break support at 5416/06 and test good support including the 100 day moving average at 5351/43. This should hold initially but if we can break lower again look for trend line support at 5285/79. Go with a break below 5270 for a test of the 200 week Moving Average at 5225 and then Fibonacci support at 5201.

Above 5460 we can test 5500. this should be a good selling opportunity but if we break higher look for 5554/60.

DAX: 

Dax opened lower having failed at 6029 on Friday and erased that day’s gains.

The last few sessions has seen us re-establish the down trend and if we break below 5770/60 today this will continue with 5704/95 the next target. If this fails to hold a slide look for 5675 and then 5619. A break below here can take us to 5567/53. Below here we have a gap to close down to 5488.

Any rally today may be short lived but look for resistance at 5850/53. Any shorts here need stops above 5870 for 5907/16. This may be enough of a bounce for now but if we get back above 5930 look for 5952 and possibly 6000/10.

Shorts here need stops above 6030.

Eurostoxx:Eurostoxx reversed Friday’s gains.

Resistance at 2274/76 and above here we have a selling opportunity at 2291/94. Stops on shorts needed above 2302 for a run to 2317 but we could stretch to 2323/24 which may hold the upside today. If however we do break higher then we could see 2338 ahead of Monday’s high at 2352/55.

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Support today from recent lows at 2259/54 may be broken today and we should test 2245 before Fibonacci support at 2234. Worth covering shorts here but if we do break lower again go with the move lower in search of 2224/21 and then 2197/94. A break back below 2188 should keep the market under pressure for 2182 and probably 2170. below here we can target 2142/36. If this fails to hold the downside we should close the gap to 2108.

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