FTSE 100: 5258  Resistance Near 5300

We have enjoyed significant rises in the markets since the bottoms seen in March (The FTSE100 fell to 3460).  The point has now been reached where investors are asking if current levels will break down.

Here are the views of one respected Technical Analyst I follow :-

For the FTSE 100 this morning is probably as much about consolidation again, after the flotation with intraday highs of the year yesterday. The hourly chart shows a rising trend channel in place since early last week with the floor of the channel running through 5220. The implication is that unless we see an end of day close below the November uptrend line there is little reason to imagine that will not be further upside for this market. Helping the bulls to remain confident is the way that we have finally got our golden cross between the black 200 period moving average and the blue 50 period moving average.

This is a buy signal in a classic technical sense, and it would be very disappointing/surprising if the signal failed.

It looks like more upside to come.

Peter Waller – Investment Director