I have attached a screen shot of the daily ''cash'' chart for the FTSE 100 showing yesterday's action being clearly indecisive leading up to the European meeting tomorrow. This is not too surprising given the importance of this meeting and the impact it will have on the markets going into 2012. The future of the EURO is hanging on the outcome of this meeting.
This week we have been focusing on 5600 and we discussed that the market would find it tough to make progress above here before the news. This has clearly been the case but what we haven't seen is a continued decline towards 5370 which would fit well for the wave count. At this stage the most likely outcome is the correction we were expecting, ended yesterday at 5500 and we are now going to see higher prices towards 5700 as investors buy ahead of a meeting, which they expect to deliver a clear resolution to the European debt crisis. Personally as a trader I am not comfortable buying here even though higher prices are likely. We are still in a bear market and we are currently over bought.
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