FTSE for Friday: frustration but 10,000 awaits
An inability to do much over the past five months is a worry for independent analyst Alistair Strang. Here's what he thinks of prospects.
11th October 2024 07:21
by Alistair Strang from Trends and Targets
Last night, the Aura Borealis was substantially better than the display last May, as this time curtains of light were clearly visible in the sky above Argyll, amazing colours appearing then vanishing, along with what looked like jet contrails crossing the sky from east to west.
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It’s interesting to note that since the previous Aurora event five months ago, the FTSE 100 has hardly moved, fluttering above and below 8,300. In the same period, the Down Jones has gained 3,000 points while Germany managed a 1,000-point gain. Even France has been worthy of comment, unfortunately due to the index sinking by 500 points.
But for the UK, we’re worried at the market's ability to effectively flatline for so long.
We’re obviously extremely frustrated at the lack of imaginative movement. Visually, if it were a share, we’d be pretty comfortable it was simply awaiting the correct set of circumstances to head upward and paint new all-time highs.
To be fully ridiculous, we need to admit the FTSE index value is now regarded as trading in a zone where a future attraction is coming from 10,190 points. This is a significant number when compared with current price levels.
The obvious worry with such halts in market gains is the old threat, “if it ain’t goin’ up, it’s goin’ down.” Generally, when a share price experiences this sort of hesitation, any downward movement tends to be short-lived, the market being surprised by quite coherent recovery and gains.
From a nearer-term perspective, the salient detail is the FTSE 100 hasn’t actually done anything since May 2024 is proving extremely frustrating, creating a situation where below 8,220 points now threatens reversal to an initial 8,146 with our secondary, if broken, at the possibility of a low of 8,089 points. If triggered, the tightest stop looks attractive at 8,236 points.
Our alternate scenario allows above 8,274 points triggering gains to an initial 8,327 points with our secondary, if beaten, at an amazing 8,459 points!
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.
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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