FTSE for Friday (FTSE:UKX)
This one risks being a little awkward due to the FTSE Futures market going rather insane on Thursday evening. To put it into perspective, the FTSE closed the session at 7,421 points and four hours later, Futures were tickling 7,470 points.
This sort of behaviour creates a perfect storm of contradictions for the next day. It’s fairly obvious the FTSE 100 (UKX) shall experience an ‘up’ opening on Friday, the big issue being whether any rise shall actually stick. Or will we see a session with the market spiked up at the open, only to spend the rest of the day floundering.
We’ve a rule of thumb for this sort of scenario. For Friday, if the index makes it above 7,455 points within the first 90 minutes, there’s a more than reasonable chance we shall experience the thrill of an ‘up’day which sticks.
This scenario allows for continued growth to 7,474 points initially with secondary, if exceeded, at 7,507 points. If triggered, the tightest stop looks like 7,395 points.
Of course, what happens if the market is indeed opened up yet fails to better 7,455 by 9:30am?
Famine, pestilence, etc. More probably, a day messing around between 7,390 and 7,450, at least until the USA opens. Thereafter, we’d once again hope for some proper growth on the FTSE itself.
As always, remember we are discussing the FTSE and not after hours futures. Sometimes, as Thursday evening exhibited, quite a substantial disconnect exists between the two. Only if 7,386 breaks will we expect some reversals to 7,360.
The underlying trend on the FTSE remains upward, the index requiring below 7,311 (red) before it can even be thought of as slowing.
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.
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