How credible is chance of further FTSE 100 rally?

FTSE for the week (FTSE:UKX)

Competing with Ferrari in a clown competition is, of course, the FTSE 100 (for the majority who didn't watch the Silverstone Grand Prix, Ferrari managed to lose tyres in both cars just two laps from the end in a spectacular case of synchronised cock-up).

During July, it appears the 7,300 level has provided a pretty firm floor and we've a growing suspicion the market intends to park the FTSE in a range between roughly 7,350 and 7,450 for a few days.

But the visuals continue to suggest a major tripwire awaits if 7,300 breaks as 7,270 should swiftly follow. But the secondary of 7,160 is a bit more scary.

Unfortunately, if this one triggers, recent market variations have been so ridiculous it requires at least a 100-point stop.

However, if our suspicion of the market being parked, essentially treading water, proves correct, anything near-term above 7,420 should prove capable of generating 7,450 initially.

Secondary, if beaten, is a theoretical 7,550, but we'd prefer waiting until the immediate downtrend - currently 7,480 - is bettered before allocating any credibility to such an ambition.

If this upward movement triggers, the visuals indicate a stop level of 7,380 is about the tightest sanely possible.

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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