The FTSE 100 has been on a bullish run since March 2020 low. It appreciated almost 57% because the Covid-19 pandemic. An additional appreciation continues to be in play primarily based on the Elliott Wave rely it has fashioned since 2020.
July 27 2022 – Weekly Timeframe
Source: Buying and sellingView ready by Zorrays Junaid
According to the weekly timeframe chart, the FTSE 100 is unfolding a 5-wave sequence to the upside. Alongside my rely, you’ll be able to see that wave (3) breached by means of the 200 day Moving Average and has remained above it as wave (4) unravels.
Wave (2) unfolded as a Zig Zag and primarily based on the rules of alternation we will see that wave (4) has developed a Contracting Triangle formation. An Elliott Wave Theory primarily based Contracting Triangle is a sideways correction which signifies the market is flat, however it’s increase the following outburst throughout the total development. Triangles strictly present up previous to a last push into the general development, subsequently, a rotation is predicted as soon as wave (5) is over – I might be updating this development in the longer term.
July 27 2022 – 4H Timeframe
Taking a more in-depth take a look at this triangle – it has complied with the foundations accurately. It unfolded in a 5-wave contracting sequence labelled as ABCDE. More importantly, wave C didn’t exceed the acute of wave A, wave D didn’t exceed the acute of wave B. Finally wave E didn’t exceed by means of the invalidation degree which is the acute of wave C.
The subsequent transfer anticipated on the playing cards can be a 5-wave sequence labelled 12345 favouring wave (5) to the upside. This transfer can take as much as a few weeks to a month to finish. The first pit cease to see is the break of wave D after which the break of the highs at 7676.
Invalidation Level
If worth decides to interrupt by means of the acute of wave C at 7016. There is an efficient likelihood that the FTSE 100 has returned to wave (4) or this complete transfer was a 3-wave sequence to the upside, subsequently a corrective transfer. If that’s the case, the FTSE 100 can count on to appropriate deeper into March 2020 lows.