The FTSE 100 has crashed lower alongside other global indices, as US political uncertainty and a rise in Covid-19 infection spooks financial markets.
UK 100 analysis shows that the index could see substantial technical selling if the 5,760 support level is overcome.
FTSE 100 medium-term price trend
The FTSE 100 has given back all of its hard-fought monthly gains, as traders and investors go into risk-off trading mode after a summer of stability in financial markets.
FTSE 100 technical analysis shows that the index is vulnerable to a major technical sell-off if the 5,760 support level is broken.
Technical analysis highlights that the index is close to falling under a declining price channel, which is located between 5,760 and 6,200.
According to the size of the price channel, a bearish breakout could see the index tumbling towards the 5,200 area and possibly lower.
If bulls can defend the 5,760 level, then a powerful counter-rally towards the 5,940 and, possibly, the 6,000 region remains possible.
FTSE 100 short-term price trend
FTSE technical analysis over the short term shows that the index has a short-term bearish bias while the price trades above the 5,880 level.
The one-hour time frame is showing that an extremely large head-and-shoulders pattern has formed following the recent decline towards 5,800.
According to the size of the bearish reversal pattern, the FTSE 100 may rally towards the 5,500 level over the short term.
Technical analysis shows that bulls need to rally the price above 6,100 to invalidate the bearish price pattern.
FTSE 100 technical summary
UK 100 analysis shows that the index could come under severe technical selling pressure if the 5,760 support level is breached.
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