FTSE for Friday: four indicators predict this move
Normally, independent analyst Alistair Strang requires just two indicators to be confident about a move. This time he's got double that. There's also an update on potential for the AIM market.
2nd May 2025 07:41
by Alistair Strang from Trends and Targets
Every day seems to bring a series of false starts and stops for the FTSE 100. But the AIM market has managed to tick the first box in an optimistic argument for the future, suggesting the potential of movement to an initial 780 points, perhaps even a longer term 840 points which will hint at a happier future.
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Of course, there is always the risk that AIM is gathering trader attention, because the FTSE 100 is pretty lame at present? It’s certainly something worthy of consideration as AIM has previously exhibited such behaviour while the FTSE mucks around. If AIM intends to cause concern, it needs to slither below 635 points, a fairly comfortable distance away from its current 700 points.
As for the FTSE 100, perhaps some hope may be possible as it just broke above the downtrend since the start of March, giving some slight hope that market growth may be on the cards.
Allegedly, the movements on 1 May indicate the potential of a less than spectacular drift toward 8,570 points. We shall regard 8,570 being exceeded as important from a Big Picture perspective, moving the index into a zone where folk can dream of a long term cycle to a five-figure index is commencing.
From a near-term perspective, above 8,507 points should apparently trigger movement to an initial very confident 8,533 points. The tightest stop for such a movement is at 8,483 points but, realistically, we suspect such a relatively small jump could happen in the space of a single economic announcement.
What is extremely strange about this target level is we’ve four indicators suggesting the FTSE shall head to such a point, essentially so obvious it’s making us nervous. In our world, two indicators suffice to allow “confident” narrative, but four allows for worry, perhaps suggesting the market is planning a big “Gotcha” move. Or then again, maybe the market knows something the rest of us don’t, perhaps a series of interest rate changes by the Bank of England designed to boost the economy?
Our secondary, above 8,533 points calculates at 8,555 points, perhaps an early starting signal for a real growth cycle.
If things intend to go pear-shaped, our converse scenario suggests below 8,465 as holding the potential for trouble, indicating an initial wimpiest 8,450 with our secondary, if broken, at 8,433 and hopefully a rebound.
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.
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