FTSE for Friday: the index could hit a glass ceiling here

After an incredible recovery from its low point earlier this month, independent analyst Alistair Strang sets out his major target levels for the blue-chip index in the days and weeks ahead.

The market is now in a very strange situation, one where a long position may prove fascinating. Or extremely painful!

It has now been a month since the Ukraine conflict began and were we completely gullible, we’d now be proposing the FTSE 100 index intends a recovery toward 7,720 next. After all, as the chart highlights, the index has recovered to the pre-Russia level. This, we suspect, is where a glass ceiling shall come into play, if only due to a realisation the issue has not gone away.

The day before Russia invaded, the  FTSE had a high of 7,550 points. To be stubborn, only market closure above this level will convince us a return to normality can be scheduled. Instead, we suspect we’re looking at a phoney recovery, possibly fuelled by a complete lack of knowledge as to what is actually going on.

Painfully obvious propaganda from both sides is tending to cloud any attempt to discover reality and, while this should be expected in any conflict, market movements, certainly from a day to day perspective, feel the opposite of trustworthy. It’s possible the stunning recovery from the 6,800 point level on 7 March shall prove completely erroneous, an amazing 700-point rise in just 14 sessions risking becoming a fond memory very quickly if anything goes seriously wrong in Europe.

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With the market flirting coquettishly at the level before everything hit the fan, we’d be reticent in advocating any sort of long position at present. Clearly, the market has recovered, but so far has failed to exceed the high achieved prior to this mess.

Source: Trends and Targets. Past performance is not a guide to future performance

As for our popular FTSE for Friday, we’re going to start with a potential short scenario. However, it must be remembered the market is currently hovering at a hesitation level, a point in time where both Long and Short positions are liable to fizzle out around our initial target levels.

Near term, below 7,453 should apparently promote reversal to a rather tame 7,428 points. If broken, our secondary calculates at 7,397 points.

Visually, our initial target does make some sense, running into an imaginary Red uptrend since the low earlier this month. We’re not convinced about our secondary, if only due to it taking the index into a zone with a longer term attraction down at 7,335 points.

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Our Long position scenario is slightly less vague, suggesting movements next above 7,492 should make an attempt at an initial 7,507 points. If exceeded, our secondary calculates at 7,524 points. Both ambitions keep the index toddling around the glass ceiling level, something we shall not concede is broken until such time the FTSE 100 closes above the high, the day before Russia invaded.

Source: Trends and Targets. Past performance is not a guide to future performance