FTSE100 drops to level traded in March

The FTSE100 is developing a bearish wave, as it was explained last week. The index is down for the third consecutive session, down today 1.13% to 7,351 points.

The index went below the 50% Fibonacci support of the uptrend October-February and in case the selling pressure would continue next test is in area 7,200, the 61.8% level.

Possible a development of a trading range from 7,200 in the short term as there is a bullish spike that could make a double bottom in perspective.

Too premature for a bullish set up at current levels, as the index would have to cross above its 200 day SMA to show some positive resilience.

Monetary tightening is likely to continue with a 7% level by the end of the year. Given the international composition of components of the FTSE100, the exposure to both global shocks and to domestic credit tightening is likely to steer away bulls for FTSE100 in the medium term.