After what could be considered very short-term consolidation near the prior session’s highs, prices lost buying support at 5435 (X) and the FTSE 100 sold off through the support of a Triangle pattern on the 60-minute time frame. The intraday volatility lessened as prices squeezed into a narrow channel between 5455.3 and 5436.3, and the sideways market was confirmed by the three-bar Autochartist Initial Trend reading. The move lower through the floor at 5436.3 ushered in accelerated selling and pushed the index down, confirming that the breakdown shifted sentiment from neutral to bearish.

Prices have currently reached a layer of buying support between 5417 and 5393 (F), which is the Autochartist Forecast area for the Triangle breakdown short sell. While the overall trend on the 60-minute chart is heading higher, this pullback could represent nothing more than short-term profit taking. If, however, support between 5381 and 5379 is broken, look for a more sustained correction lower towards 5373, then 5350, which is the Fibonacci Retracement support area from the rally that took place from 5290 to 5455.

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