Interactive Investor

FTSE for Friday: can FTSE 100 end week on a high note?

It's not straightforward reading markets right now, but after running the numbers, independent analyst Alistair Strang shares his conclusions.

14th June 2024 07:45

by Alistair Strang from Trends and Targets

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Perhaps it’s an election season thing but we must admit we’re experiencing some difficulty making sense out of many recent market movements. On Thursday, the FTSE 100 had enjoyed a fairly well travelled day, yet market futures from 5pm simply ran out of inspiration.

From our perspective, it was a fairly big deal!

The market was “supposed” to reach 8,140 points and bounce, according to our Big Picture calculations, yet the lowest it achieved was just 8,147 points followed by a weak bounce.

Sometimes, a price drop bouncing above a target level is an indicator of inherent strength. What was interesting from the nature of the bounce, was the market recovering to around 8,170 before effectively spending the next four hours flatlining.

With the actual market opting to close the day at around 8,160 points, we thought we’d witnessed an early signal of Friday providing some upward entertainment, but this has not been reflected in after-hours futures. Instead, the Futures market ended the day at 8,160, causing a degree of head scratching.

If we choose to take a pseudo optimistic viewpoint, perhaps what we witnessed was the Futures market closing stable, creating a situation where the FTSE 100  shall open without the danger of any spike upward or downward, letting the market do its own thing for a change.

Should this scenario indeed prove to be the case, some hope is presented with an initial hope movement next above 8,165 will next trigger index recovery to an initial useless 8,178 points. If triggered, the stop loss can be at 8,145 points, fairly tight given our next scale of ambition.

In the event 8,178 is exceeded, our secondary is more useful at 8,207 points. In this scenario, we’re able to give a third tier hope at 8,242, along with a fairly strong hope next week shall be upwardly buoyant on the FTSE.

As always, we’ve a converse scenario, and this one is quite unpleasant, calculating with the threat of weakness below 8,145 triggering reversal to an initial 8,090 points with our secondary, if the initial target breaks, working out at an unlikely looking 7,996 points.

In this instance, we rather think Friday should provide a day of gains on the FTSE. 

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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. 

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