After the City index spiked yesterday on Brexit news, our chartist discusses potential.
FTSE for Friday (FTSE:UKX)
For Friday, the FTSE 100 is in a fairly interesting position. It closed Thursday at 7,182 and needs to exceed yesterday's high of 7,238 before we dare believe the FTSE is celebrating in earnest, showing the potential of some real recovery.
Near-term, above 7,242 indicates coming growth to an initial 7,257 points. If exceeded, secondary is a more useful 7,294 points and a level where some hesitation is expected.
However, if the market opts to "go for it", we can mention a third level target at 7,349 and this calculates as a point where some volatility is expected.
Interesting to note, it also intersects with the downtrend since July.
As always, we've a "however" and alternate scenario. The lowest the market has achieved in October has been 7,004 points, this being a concern.
We had calculated a "bottom and bounce level" at 7,034 points and the index squirmed below.
Thankfully, for those chasing a bounce, we'd also proposed a stop loss around 6,990 points and the index has certainly provided payback.
But our 7,034 did break, hinting at a risk of real weakness if sufficient excuse discovered.
Now, below 7,141 calculates as entering a cycle down to an initial 7,083 points. If broken, secondary calculates at 7,024.
This again shall take the FTSE into the land of lower lows where an ill timed Tweet or political quote could rapidly provoke reversal to 6,750 points.
For now, we shall not be surprised to witness 7,349 before everything unravels again.
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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