Footsie defending key support again


The FTSE 100 index declined notably on Thursday and tested previous lows of 5,800 GBP yet again, only to bounce from this level and post a 1% rally on Friday.

At the time of writing, the Footsie was spotter near 5,920 GBP, with momentum being bullish heading into the US session.

It seems that the 5,800 GBP level will survive anything and the index just refuses to go below this support. But can you imagine how many stop-losses are below this level? 

If a bearish breakdown occurs, the further decline could be very fast as traders would be closing their long positions. The next target for bears will most likely be at 5,600 GBP.

Alternatively, the initial resistance now appears to be near 5,950 GBP and afterward at 6,000 GBP. However, the critical resistance could be spotted at 6,050 GBP, where the medium-term bearish trend line is located. The index needs to push above this level for bulls to feel more comfortable.
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