They say that a market correction requires a fall of at least 10%. So far, at 6885, the UK Index has fallen 9.1% from September’s 7560 peak. A revisit of 2018 lows of 6840 would take it to 9.6%. Some would say this is enough, especially after a 13% fall from May’s 7900 record . However, another 2% fall this week suggests the market begs to differ, needing to trade still lower before bottoming out.

Might we be set to mimic what happened earlier this year, with a sharp decline, a pause, another shorter leg lower and then a recovery?  For the moment, genuine signs of a bottom are distinctly lacking. Look at that pair of red and green candlesticks at the March low. Surely we need to see the same again before the index delivers a bullish reversal?

Bulls are looking, at the very least, for a break above 7000, to escape this week’s falling channel. They may even need a break above 7100 (+3%) to inspire hope of a full rebound towards 7900 (+14.5% upside).

Bears, on the other hand, given we’re so close to March 6840 lows, will want to see this level breached before assuming that there is more downside on the cards, for a move towards December 2016 lows of 6682 (-3.1% from of current levels).

Our watch levels: Bullish 7000, Bearish 6838