A crucial new FTSE 100 level to watch

The FTSE, The future, The… whatever (FTSE:UKX)

A weekend with some truly surprising results. Apparently the West bombed somewhere without Russia intervening. Perhaps it was the Norfolk Broads, thus unnoticed by the media. More importantly, Formula 1 became interesting in China!

Since the start of April, the markets have pushed steadily upward, actually managing to give some hope for the future – this despite lurid newspaper headlines and drooling TV commentary. We’ve got a new number worthy of note on the FTSE (UKX) and it’s at 7,293 points.

Apparently, should the FTSE manage above this point, ideally closing a session above, then a cycle to an initial 7,404 points should commence. Secondary, if bettered, staggers along at around 7,575 points. Stop can be placed below red on the chart, currently at 7,150 points.

One thing bothering us about all this optimism came from some share movements during the trading session on Friday.

Sometimes it appears deliberate efforts are employed to slow things down and there’s little doubt this behaviour was present amongst some banking shares.

Genuinely, it makes us speculate whether the market is nervous about blind growth against a background of military threats. Should this be the case, we’d suggest some caution before blithely aiming for our secondary upward targets.

Then again, the market loves fear, especially fears which prove groundless.

What happens should 7,150 break?

An initial relaxation to 7,110 makes some visual sense. Secondary, if broken, comes along at around 7,000 points where we’d hope for a real bounce as the consequences below are quite grotty. We have mentioned 6,800 a few times previously.

Source: interactive investor                 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, Shareprice, or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea. 

These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation, and is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company’s or index name highlighted in the article.