FTSE 100 Price Movement

[Daniel Lummis]

This thread is for anyone who wants to or is currently trading the FTSE100 Index. I have traded the FTSE100 price movement for many years. I am starting this thread as a way to share my ideas, receive feedback and hopefully get some new ideas from anybody viewing the blog.

 

[Daniel Lummis]

Long term bearish

First Idea

Why I am long term very bearish and expecting a LARGE pull back in the not too distant future.

The weekly chart is currently hovering around a previous resistance point and failing to break through.

The MACD is also showing divergence which means although we are making higher highs we are losing momentum. From past trading experience, MACD divergence can be a strong signal that things are about to turn around.

The monthly time frames tends to highlight business cycles and according to the chart attached we are right near important resistance and what I believe will be the end of the bull market from 2009 to 2014.

 

[unexposed]

Very interesting. I am new to this, but i am right assume this is all based on technical analysis? Or do you use some form of fundamental analysis alongside this to try and judge the market sentiment?

 

[Daniel Lummis]

All based on Technical Analysis and Behavioural Finance. From personal study I don't believe there are any fundamentals (public available information) that have not already been factored into the price. Most Technical Analyst believe this but I'm sure many others will disagree. Let me know what your opinion is.

 

[Daniel Lummis]

Short Term Bullish

Although I am long term bearish I believe there will be a bounce from around 6400 - 6450. Price has reached significant support levels and we could see a bounce of what I think will be between 200 - 300 points. History does tend to repeat itself.

 

[Daniel Lummis]

So we did not get a bounce back from 6400. Price has plummeted right through and now sits around 6280.

This adds emphasis on why I am long term very bearish. The price on the weekly chart now has penetrated support lines and looks to be starting a new downward trend.

The 50 day SMA has been crossed and looks to be turning on the downside also.

There still could be short bounce in price to around 6600 before continuing the down trend but I wouldn't like to gamble against the recent downside momentum.

 

[Charles Bronson]

Interesting analysis. I agree that there is a big drop due soon, not talking about what has happened in the last few weeks. I still think a recession is due, but not yet. The market is too close to its highest ever point and it will at some point make new high ground. Some time after that I would expect there to be a big drop, lasting a few years.


This coincides with what I see happening to gold. Ftse will go up when gold is down, gold will drop further allowing the ftse to rise higher. When ftse is ready for a drop, gold will continue a bull run.

Only my opinion, but I thought I would share it. Cant do f*** all without writing 20 posts.

 

[dr.blix]

Glad to see someone doing some FTSE analysis. I have a vague notion that 2015 will see a major correction. Based on the last couple of corrections having a 6 year cycle.

 

[Daniel Lummis]

To follow up on my previous post about the weekly chart, I am still very bearish on the FTSE. We saw a drop as expected and the bounce failed to break through resistance. I would be looking for a very short term bounce of the price perhaps to around 6500 and use this as an entry point for a short position. If anyone has any thoughts or contradictions feel free to share.

 

[jeffre4]

down to 6292 area then bounce back up to 6850 area in my humble opinion

 

[Splitlink]

All based on Technical Analysis and Behavioural Finance. From personal study I don't believe there are any fundamentals (public available information) that have not already been factored into the price. Most Technical Analyst believe this but I'm sure many others will disagree. Let me know what your opinion is.

I believe in fundamental analysis, combined with TA for individual stocks. A cheap, well capitalised stock, with 4-5 years growth, averaging 10% and debt less than 30% have served me well over the years. Next Plc was a prime example and got me started.

However, indices have to be pure TA, IMO. With so many shares comprising an index and with the FT30 based on the highest capitalised shares in the LSE, these are not going to grow very much on a capitalised %age basis. They will move mainly on the world economies, slumps, wars etc. ie TA,