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Here's a red flag for FTSE 100 sell-off
By Alistair Strang | Fri, 17th February 2017 - 09:32
Written: Thursday, 16th February - 23:01
FTSE 100 for Friday
The market has experienced an almost amusing week, averaging 18 points a day of range. Or, in plain English, utterly rubbish.
For us to have justified concerns about any reversal near-term, the index needs to slip below 7,226 points to signal a path to an initial 7,175 points. And, if that breaks, secondary calculates at 7,080 points.
However, we were interested in a movement on the FTSE 100 just 40 minutes before Thursday closed, as the momentary sojourn at 7,293 was higher than expected given the lacklustre day - although Thursdays are usually a bit rubbish, due to ex-dividend things.
If we're right in what we saw, there's a chance Friday may prove interesting.
Near-term, above 7,293 allows growth toward a useless 7,301 points with secondary, if bettered, at a more interesting 7,331 points.
This is where it all gets a bit crazy. On Wednesday 15th's evening, FTSE Futures managed 7,335 points whereas the best the FTSE itself achieved during the session was 7,313 points.
Generally, when this sort of thing happens after hours, the market is opened at the Futures level the next morning but, instead, the FTSE was plunged to 7,278 on Thursday morning at the open and spent the rest of the session comprehensively doing nothing.
We've a sneaking suspicion the market "really" wants a stab at 7,331, so perhaps worth watching near-term. If triggered above 7,293, the index would need below 7,270 to trash the immediate upward prospects, thus a fairly useful stop-loss position.
As usual, here's hopping, and, as always, remember we are talking about trading during FTSE opening hours, not after-hours futures.
(Oh, thanks for the emails. That bloke is still looking for his falcon. A joke about radio controlled airplanes didn't go well)