FTSE for Friday: a number that's a big deal for FTSE 100
Unimpressed by market movement in recent months, independent analyst Alistair Strang reveals what he believes is needed to make a meaningful and sustained break above 8,300.
4th October 2024 07:18
by Alistair Strang from Trends and Targets
It’s becoming a bit of a chore doing our FTSE for Friday, simply due to the lack of realistic action emanating from London.
A couple of years ago, a report from the Office for National Statistics revealed portfolio ownership of UK listed companies by Pension & Insurance funds had slumped from 45.7% down to just 4.2% in 2022.
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The theory now circulating suggests international investors are not interested in UK shares, as UK institutional investors avoid them like the plague. It is certainly a theory worthy of consideration, one which is backed up by the number of companies fleeing a UK listing for the attraction of Wall Street and an environment where share prices actually move meaningfully.
It’s said the majority of changes to the value of the FTSE 100 this year are due to the value of companies replacing those leaving their UK listing behind.
Our grump about the markets is obviously due to September wasting everyone’s’ time, the UK central bank dodging its opportunity to become useful and now we’ve entered October with the organisation claiming it plans aggressive movement on interest rates until the year end. This panic statement tends to concur with a suspicion the penny has finally dropped among governmental institutions that they’d dropped the ball, literally failing to favour the most important and valuable part of British industry, the financial sector.
Maybe it shall prove the case where October shall start to deliver some optimism, both due to forthcoming changes in FTSE rules and changes in UK interest rate policy. This being the case, it should be easy to identify early warning signs for happier days ahead with some genuine index movements.
Should this be the case, near-term movement exceeding 8,333 points should trigger market recovery to an initial 8,367 points with our secondary, if bettered, at 8,411 and a reasonable chance of some hesitation, due to historical highs.
Market closure above 8,411 shall be regarded as a big deal, entering a cycle where a visit to a longer term 8,595 becomes possible.
If things plan going terribly wrong, below 8,226 now risks promoting reversal to an initial 8,119 with our secondary, if broken at 7,950.
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.Â
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