There’s considerable hope the market is breaking free of the hiatus which has been 2021, writes independent analyst Alistair Strang.
This week has been fascinating with the FTSE 100. In North America, and to a lesser degree, Europe, stock markets are proving quite volatile. Whether it’s a Covid-19 thing or, more possibly, related to China Evergrande again missing bond payments, watching the FTSE somehow managing to avoid slavishly follow the rest of the world proved a welcome relief.
It almost makes us wonder if the UK market’s position now means everything is ‘factored in’ and we’re at a level where some positive thought can be allowed.
When we started our report on the FTSE last week, providing a confident attitude was a truly unusual experience. Despite other markets experience 2%-plus down days, the FTSE maintained a stiff upper lip, and a positive attitude remains available for the start of October.
Our favoured cliche, “if it ain’t going down, it’s going up” shall hopefully come into play anytime soon.
Near term, movements above 7,143 look capable of triggering FTSE travel to an initial 7,185 points. In the event London manages above 7,185 points, things start to get interesting pretty fast as our secondary calculates at 7,265 points.
Source: Trends and Targets. Past performance is not a guide to future performance
An ambition such as this secondary level risks being ‘game changing’ for the longer term, presenting an official higher high and again giving considerable hope the market is breaking free of the hiatus which has been 2021.
The flip side of the coin comes should London find sufficient excuse to wither below 7,072 points. This scenario calculates with the potential of weakness to an initial 7,053 points. If broken, our secondary works out at 7,006 points.
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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