FTSE 100: The Big Picture

FTSE for Friday (FTSE:UKX)

As with hurricanes, sometimes an occasional satellite photo of the markets isn’t a bad idea and, in the case of the FTSE 100 (UKX), it also provides one of our rare “print it out and stick it on the wall” comments.

In addition, the second chart below is especially curious when viewed against its 21-year-old parent.

Firstly, there’s something important about The Big Picture. It tells us, once again, should the FTSE now trade above the 7,600-point mark, it enters a cycle to 7,900 next.

Secondary comes in at a very probable 8,700 points. Additionally, amazingly and even astoundingly, our software advises if the movement triggers then no stop is required!

This particular proposal is given as a result of just two criteria. Either the stop should be as tight as heck, or the width of a required stop is too stupid to suggest.

When this sort of nonsense crops up, here’s a reasonable rule of thumb; if the movement triggers, stick in a stop loss just below the prior days lowest level.

Or accept your trading software’ default and crucially, go do something else for a while and stop paying attention to the markets.

For now, though, it’s quite curious how market conditions in the last few weeks tend to mimic the FTSE Big Picture.

It’s certainly something we don’t recall seeing previously and, if this microcosm of the Big Picture behaves the same way, allegedly the FTSE is about to experience a near-term boost. If this is the case, here are the key numbers.

Near-term, should the FTSE better 7,414, it enters a position where we’re looking for some growth to 7,465 points initially.

Our secondary, if such a level is bettered, comes in at 7,550 points. About the sanest stop appears to be 7,350 though, if we resort to drawing lines, there’s a suggestion a stop could be placed at 7,399 points.

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. 

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. 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