Despite the devastating war in Israel and Palestine – The FTSE is ready to rally to new year high

Turmoil…

That’s the only word I can think of right now for the world.

I’m sure you also share this concern with:

• the escalating wars with Israel and Palestine
• The conflict between the US, Ukraine and Russia
• The economic fight between the West and the East
• And with the ever-weakening rand and strengthening US dollar

And one would think we should expect more downside for the markets.

And yes, it is true for a couple of markets.

But NOT the FTSE 100.

Today’s focus will be on why I expect the FTSE 100 to rally to new year highs in the coming weeks.

Here’s why and how to profit from the run…

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The European markets have remained resilient despite the conflict

In fact, we’ve seen European markets rally in the last two weeks.

We’ve seen a surge in the Stoxx 600 and with the Germany’s DAX index.

But most importantly, we’ve seen a strong run up by the FTSE100.

In fact, the FTSE 100 had one of the best days in the year rallying over 2% in one day.

Now I don’t know the exact reasons why the FTSE 100 has rallied all of a sudden, but I have some ideas.

First.

We’ve seen a surge in oil prices triggered by the Hamas attacks on Israel.
Remember, when there is less supply for oil, there is more demand.
And with the rise in oil prices, there is also a greater demand for oil-related stocks. Like BP (up 9%), Shell (+8.50%), Sasol (+6.87%) and BAE systems (+5.78%)

This has helped contribute to the recent run up in the FTSE 100.

Rallies in Europe with the Stoxx and DAX has also set a positive tone for the FTSE 100 as well.

And the charts agree with the upside to come.

Why this Triple Bottom is showing a strong surge for the FTSE 100

We are looking at the daily chart of the FTSE 100.

We can see since the end of May 2023 up until October 2023, the price has been moving in a sideways range.

The high of the range is at 7,770. While the low of the range is at 7,200.

In the beginning of October, instead of coming down and retouching the low, the price made a higher low at 7,384 before it bounced back up.

This tells me it’s forming what’s known as a Triple Bottom pattern.

This is a bullish pattern with three rounding bottoms.

And connected to the top of the rounding bottoms is a common horizontal neckline (resistance).

In this case the neckline is (and will be tested again) at 7,721.

Based on the information, we’ve mentioned today, along with the higher low – I expect the price to break up and out of the triple bottom.

Once we get that breakout, demand will be piling in at a very fast rate.

And this could cause the FTSE 100 to rally to a new year high at 8,545.

Here’s how I’ll profit from the 10.6% FTSE 100 rally

First, I will go long (buy) the FTSE 100 CFD and hold it until it reaches my first target at 8,545.

Second, I will look to be buying JSE stocks that are also dual-listed companies on the FTSE 100. I’m talking about Anglo American, Mondi, South 32. If you want to join in with the FTSE 100 rally and profit with me, click here…