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In my last article, FTSE100 formed a triangle that supported the overall bullish trend in the bigger picture. However, on the other hand, I cautioned that even though the triangle is valid, it does not mean that it is a bullish triangle.
Instead, the triangle supported the temporary bearish sequence of the FTSE100, including other indices such as DAX and SPX are deployed internally.
Let’s take a look at the updated Elliott wave count on the FTSE100
As shown here, wave 4 is now unfolding as a zigzag with wave (B) as a triangle. Wave D of the key level (B), which was at 7131, triggered this bearish triangle, indicating that another wave (C) 4 low is on the cards.
The trend has been established as bearish, so let’s discuss the momentum. According to the chart, the RSI looks bearish but not oversold. The MACD is showing a crossover, so there is clearly more room for downside.
Analysts should note that the triangle in Elliott wave theory indicates that the next impulse is the last impulse in the current sequence.
Let’s take a look at the updated Elliott wave count on the DAX
I previously showed on this chart that the DAX is in a wave B triangle to indicate that another push to the downside is in the near future. With wave ((d)), the key level of 12603 was broken, which means that the triangle has been triggered and a push can be expected.
Like the FTSE100, the RSI looks bearish but not oversold, and the MACD has more scope to turn negative after crossing the MACD moving average.
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