FTSE for Friday: situation remains promising for FTSE 100 and gold
2nd December 2022 06:48
by Alistair Strang from Trends and Targets
Despite a cost-of-living crisis and impending recession, independent analyst Alistair Strang's charts point to further gains for the blue-chip index. There's also an update on prospects for the gold price.
Last week in our FTSE for Friday, we’d expressed some optimism for the FTSE 100 as, despite lots of media hype suggesting market reversals, the FTSE appears to indeed be setting out on a path to 7,777 points, refusing to sleepwalk into the much promised recession. The situation remains fairly promising.
Now above 7,604 suggests the potential of further gains to an initial tame 7,622 points with secondary, if beaten, a slightly more encouraging 7,642 points.
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Overall, we continue to regard 7,777 as a viable target eventually on the current cycle. Unfortunately, the required stop loss for this scenario remains insane at 7,421 points.
Our converse scenario implies the market needs below 7,505 to provoke reversal to an initial 7,481 with secondary, if broken, at 7,421 and hopefully a bounce.
Past performance is not a guide to future performance
GOLD (XAU/USD)
The yellow metal is getting a little interesting, presenting some allegedly safe characteristics.
It’s apparently the case that movement now above $1,805 should next make an attempt at $1,835 with our secondary, if bettered, working out at $1,901 .
We’ve loads of arguments favouring gains such as this, perhaps too many as it makes us suspicious. Then again, it is the festive season and maybe gold is about to enjoy its own little Santa Rally. It needs below $1,750 to justify panic.
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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