FTSE 100 20201016 16.51

The daily chart shows the UK big board came with a few points of printing a fresh multi-month low on Thursday, although subsequent price action has been positive and strengthened that area of support. With this support seemingly in place for the short-term, the cluster of moving averages above continue to crimp price action and suggest a breakout. All three simple moving averages are within 50-55 points of each other and continue to point lower, constricting price action and leading to an imminent break. The three moving averages are clustered between 5,930 and 5,986 with the 38.2% Fib retracement at 5,889 just below. The FTSE will need a fundamental driver to force a breakout of the current technical stranglehold.
Away from the negative fundamental backdrop, the FTSE is also struggling to push higher with its path blocked by a cluster of moving averages which continue to force the indices lower. Add into the mix an important Fibonacci retracement level and multi-month low prints and the FTSE needs a boost of positive sentiment if it is to push higher.

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