Interactive Investor

FTSE for Friday: forecasts for the blue-chip index and Kingfisher too

29th April 2022 07:27

Alistair Strang from Trends and Targets

Kingfisher shares are down 27% already in 2022, so independent analyst Alistair Strang studies the form for signs of a rebound. He also gives his latest view on the FTSE 100 index.

Inspiration to review Kingfisher (LSE:KGF) wasn’t hard to come by, due to a disastrous DIY event. It appears, for whatever reason, Kingfisher (owners of B&Q and ScrewFix in the UK) are enjoying their own share price meltdown, something of a surprise given the return to what passes for normality in the UK.

For Kingfisher, perhaps it’s the outlandish level of price rises being enacted in their B&Q stores. Apparently prices for ‘raw’ timber can now change daily, creating a difficult situation for a corporate dealing in bulk sales. Then again, perhaps the company exposure to their successful outlets throughout Europe is creating an issue.

Source: Trends and Targets. Past performance is not a guide to future performance

Regardless, the share price has been falling and things are not looking great.

The Blue line on the chart, the share price downtrend, dates back to 2014 but, importantly, it can also be extended far back in time to 1999. Thus, Kingfisher has seen their price retreat below a downtrend which is 23 years old. Surely this is pretty significant.

Weakness now below just 246p threatens reversal to an initial 193p with our longer term secondary, if broken, calculating at 127p and a challenge against the Covid-19 low of 2020. The only certainty of an escape from trouble will come with any miracle gain above Blue, currently 307p.

FTSE for Friday

The UK market performed pretty much as expected on Thursday and looks capable of maintaining its recovery.

Above 7,520 points for the FTSE 100 should prove capable of triggering a nod in the direction of 7,578 points next. If exceeded, our secondary calculates at a longer term 7,644 points. The market needs below 7,470 to tarnish our optimism.

This provides a suitable trigger level, if attempts are being made to spoil the holiday weekend. Below 7,470 risks reversal to an initial 7,435 with secondary, if broken, at 7,389 points and hopefully a bounce.

Source: Trends and Targets. Past performance is not a guide to future performance

Have a good weekend. Hopefully the holiday Monday is dry!

 

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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