On Monday 30 May I mentioned the supply zone of 4155-4191 i.e. a level at which sellers could re-establish positions (see related notes). Over the last 2 weeks we have seen the index hold at the zone with Thursday and Friday seeing a strong rejection from this zone. Although the 1-month chart is being reviewed and considered, I've applied the 7-week and 7-month RSI's to ascertain the medium and long term regimes. Both time frames have a reading of 31 and 35 respective i.e. weak on the higher time frames. The next key supply zone to maintain is 3889 of which a break and close below opens further downside over the medium term. Traders should however remain cognizant of the potential changes in price action and adjust accordingly.
