FTSE recovers half of recent declines

The FTSE 100 index (daily chart shown below) has managed a partial recovery after having rebounded from a bottoming pattern around the key 6500 support level two weeks ago.

The dip in mid-April down to that 6500 support area formed a double bottom pattern with the March lows and was reinforced by a major bullish trend line that extends back to the mid-2012 lows around 5225.

The bottoming pattern around 6500 occurred after the UK equity index declined by over 5% from its multi-year peak of 6882, which was around a major triple top resistance area that was established in late February.

The FTSE has since recovered slightly more than half of that recent decline and has emerged above both its 50-day and 200-day moving averages.

Currently consolidating around the 6700 level, the index is still entrenched within a long-term bullish trend, despite the recent pullback.

Major support continues to reside around the noted 6500 level. Any breakdown below that level could constitute the larger correction that has been expected, with further downside support around the 6400 support level.

To the upside, the FTSE 100 continues to attempt a recovery towards the noted triple top resistance area around the 6870-80 multi-year highs. Any breakout above that zone would confirm a continuation of the long-term bullish trend.

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