FTSE for Friday: this is the biggest danger to FTSE 100
All of a sudden, the FTSE 100 is one of the best performing stock markets, but can it go even higher? Independent analyst Alistair Strang studies the charts to find out.
17th May 2024 07:34
by Alistair Strang from Trends and Targets
For some reason, since 10 May the FTSE 100 feels like it has decided to stop useful movement. To judge by the immediate uptrend, it looks like we’re supposed to believe everything is about to go wrong, the index piercing the red uptrend line.
- Invest with ii: Open a Stocks & Shares ISA | ISA Investment Ideas | Transfer a Stocks & Shares ISA
Whatever the real reason for the current FTSE hiatus, our inclination is to suspect we’re simply watching a “pause for thought” on a market which has underlying upward force.
About the biggest danger (aside from world events) faced still looks like Brent Crude wants to retreat to the $77 level. Obviously, should this occur, a knock-on effect against the price of oil sector shares shall doubtless provoke a stall on the FTSE, but until oil makes its move downward, we’re not holding our breath.
Near term, it feels like above 8,471 points should next trigger FTSE growth to an initial 8,495 points with our secondary, if bettered, at 8,527 points. Should this scenario kick into life, the tightest stop loss level is almost too attractive at just 8,450 points.
Our converse scenario is equally tight, reversals below just 8,417 risking triggering a drop to an initial 8,384 points with our secondary, if broken, at a nearby 8,368 points. The close proximity of these target levels suggest some sort of surprise bounce should be expected.
As the month continues, one interesting feature is making itself known, and that’s the “ruling target” level, a number which has been repeatedly calculated just above the 8,600 level.
Finally, we managed to retrieve the same answer against several different scenarios and it’s giving 8,663 points as the overall point of interest on the current cycle, a market level where some volatility can be expected.
Have a good weekend.
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.
Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea.
These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.