UK FTSE 100 and STOXX 600

A chart that breaks out to all time high levels has the least resistance. It is called the uncharted territory. Prices are expected to resume their trend after a decisive breakout to all-time high levels. This is what happened with some of the indices over the past few years. I attached below some of the strong breakouts to all-time high levels that have taken place. S&P 500 Index, Germany DAX Index and India BSE SENSEX index are some of them.

More and more equity indices are now breaking out to all-time high levels or at least preparing for strong breakouts. UK FTSE 100 index is one of them. Index closed the week above strong resistance level at 6,950. Few more weeks of strength will confirm the decade-long breakout.

Europe continues to gain strength thanks to ECB. Euro Stoxx 600 index is preparing to clear multi-year resistance at 400 levels. I’m not sure if any of these latest breakouts could end up being bull trap. The best available information (latest price information) suggests strength and increase in upside momentum in global equity indices.