Technical analyst Alistair Strang believes that from both immediate and mid-term perspectives, something odd is happening with the blue-chip index. Here's why.
FTSE for Friday (FTSE:UKX)
Obviously the UK market is doomed, expected to flounder around in chaos once the reality of the truth about Santa Claus existence is realised. But perhaps the outlook isn't quite as grim as the weather here in Scotland where, it appears, we are even exporting lots of 2nd hand boats in addition to lots of whisky, oil, and energy.
Enquiries revealed this is a consequence of a cheap UK pound, thus making boats (and used motorcycles) desirable purchases from abroad. If the current rain continues, we're going to need some of these boats back!
As for the FTSE 100, we remain harbouring a suspicion it intends to visit the 6,600 level, requiring above 7,385 presently to trash the prospects. Now, from both immediate and mid-term perspectives, something odd is happening.
The index closed Thursday at 7,140 points, needing above 7,172 to enter a near-term cycle toward 7,243 points. Surprisingly (and very strange to report), our 'normal' logic would give a secondary at 7,385, suggesting an immediate donk against blue on the chart.
Even if we chose to pare our thoughts conservatively, a mid-term secondary above 7,243 comes in at 7,325 points, i.e.; sometime next week.
About the only near-term signal of "it all going wrong" will be of moves below 7,086 reaching (and breaking) an initial 7,055 points. This would carry the implication the FTSE has already topped out, permitting a secondary at 7,010 points.
In summary, it feels like some upward pressure should continue on Friday but we're pretty far from confident about the rest of this month.
Source: Trends and Targets Past performance is not a guide to future performance
Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.
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