FTSE double top?

[esiotrot]

Just a thought but with todays drop below 5700 again does anyone agree that this might be a second double top following the minor double top at 6000 (22nd Feb and 6th March) preceding the drop to 5625?

IF so then with confirmation at around 5300 this would give a target of 4900

My brain hurts!

Have we seen the dead cat bounce?

However MACD looks set to give Buy signal and RSI has set new 14 day high whilst price has not (bullish divergence)

 

[Skimbleshanks]

I wouldn't call this a double top - just peaks on the way down.

My interpretation of double tops is that they virtually always appear right at the very top of a chart - like mountains sticking out above the surroundings - which means that there is no resistance (because it's been through all the resistance levels on the way up), only support levels. The double top then forms the resistance, and it's fasten seat belts for the trip down.

To me the FTSE100 looks as if it is in a downward channel, and just having had a little bounce. But this bounce is only a single bottom, and these are never so strong as double bottoms, therefore my money's on it going down again after this little breather.

It's spooky, but support on the way down often happens exactly where there was resistance on the way up in the past.

Going back to October 97, the FTSE 100 closing prices at a peak (head and shoulders actually) were 5317.1 on 1/10/97 and 5330.8 on 3/10/97 - so it's no surprise that the most recent bottom on 22/3/01 was at 5314.8.

 

[esiotrot]

Thanks for the reply Skim

Yes it is spooky when support becomes resistance. Maybe you could understand (slightly) if this happened at a significant number - say 5300 but often happens at a value close by - say 5317

Again, yes I take on board your comments about what are commonly understood as double tops/bottoms.

I think maybe i tried to read too much into small variations in this case. I do agree that the trend on a larger scale is down and was trying to get a grip on where its going. Currently I'm looking at the weekly chart and the bottom at 4744 - another significant level from the past.

Peter

 

[ChartMan]

Talking of spooky support and resistance.......
Moni has the following values...
368
400
432
464
496
All space 32p apart.
It also has a retrace of 16p ...50%
Will it find support at 336 Today?
There is nothing "spooky" about support and resistance being the same. It is one of the most fundamental principles of TA, upon which we all rely.