Rallies in FTSE 100, DAX 40 and Dow Have Further to Go

A weaker pound sterling and foreign investor buying of the undervalued UK blue chip index propelled the FTSE 100 to a record high on Monday. The pound sterling bouncing back following hawkish comments by BoE chief economist Huw Pill has not put a spanner in the works with the FTSE 100 hitting yet another record high and remaining on track for its fourth straight day of gains.

Minor support sits between the early-to-mid-April highs at 8,046 to 8,017.

Medium-term the 161.8% Fibonacci extension of the March-to-June 2020 advance, projected higher from the October 2020 low, around the 8300 mark represents a possible upside target.

Retail trader data shows 21.75% of traders are net-long with the ratio of traders short to long at 3.60 to 1. The number of traders net long is 10.60% lower than yesterday and , while the number of traders net short is 10.60% higher than yesterday and .

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests Germany 40 prices may continue to rise.