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Hugo in HTO Trading,

FTSE 100: Testing the 50 week moving average

Since the beginning of the year the index gained more than 2.5% plus last week rallied more than 2.0% on a wide range week, breaking above the bullish flag pattern.

The FTSE 100 is in an accumulation phase since the end of last week and is testing the 50-week moving average.

Last week the index rose with a wide range and closed near the high of the week, in addition managed to close above previous week high, suggesting a strong bullish momentum.

The Stochastic is showing an overbought market although is still displaying a strong bullish momentum.

Expecting an upward move to a key level at 6,441 (scenario 1) on a break above the weekly resistance at 6,277 and a bounce off a key level at 6,441 could push the index down a weekly resistance at 6,277 (scenario 2).