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In my last article, the FTSE100 drew a triangle that supported the overall bullish trend in the bigger picture. However, on the other hand I did warn that we, that although a triangle is valid but that does not mean that it is a bullish triangle.
Instead, the triangle supported the temporary bearish sequence that the FTSE100 including other indices such as DAX and SPX is developing within.
Let’s take a look at an updated Elliott Wave calculation on the FTSE100
As shown here, wave 4 is now unfolding as a Zig Zag with wave (B) as a triangle. Wave D of the key level of (B), which sat at 7131, triggered this bearish triangle to indicate that another low in wave (C) of 4 is in the cards.
It has been established that the trend is bearish, so let’s discuss the momentum. According to the chart, the RSI looks bearish but not oversold. MACD is showing a crossover, so the momentum is clear that there is more room to the downside.
Analysts should note that a triangle within the Elliott Wave Theory indicates that the next impulse is the final impulse within the current sequence.
Let’s take a look at an updated Elliott Wave calculation on the DAX
I previously demonstrated on this chart that DAX is in a wave B triangle to indicate that another push to the downside is within the near-term picture. With wave ((d)) a key level sitting at 12603 has been broken, which means that the triangle has been triggered and a push forward can be expected.
Like the FTSE100, RSI looks bearish but not oversold and MACD has more room to the downside to travel after the MACD moving average crossover.
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