Well another turbulent week for the FTSE 100 index this time on the positive side. After my suggestion that the market may open down after the bank holidays I’m left with egg on my face as the FTSE had two days of strong rises before falling back a little today. Any suggestion that the markets are about to turn and form a new uptrend however would be premature to say the least.
Looking at the chart the recent upward moves could merely be a retracement of the previous falls a few weeks ago which could potentially signal the ideal time to go short and sell the rally. All the technicals still indicate weakness in the FTSE with the 50 & 200 EMAs pointing downwards. The 20 day EMA has turned up slightly which is hardly surprising after the two days of strong rallies. ADX value is still high at 32 with DI- above DI+ however the ADX value has started to point down. Visually the down trend is still in force with the series of lower lows and lower highs yet to be broken.
If we take a look at a longer time frame chart, weekly instead of daily we can also see that the down trend is still in force with the sequence of lower lows and lower highs yet to be broken.
My outlook for the days/ weeks ahead is still bearish especially with the Greek election due to take place next Sunday the 17th June. In fact if I could trade the FTSE within my risk criteria I probably would go short on Monday. I suspect the recent euphoria of Wednesdays and Thursdays rises will be short lived and prices will continue to slide possibly with the Greek elections being a catalysis, dependent on the result of course.
If you do decide to trade make sure you only spread bet with money you can afford to lose. Although spread betting has the potential to make you rich you might just go broke trying to get there.
Spread Betting Action
In other news I closed out my enterprise inns position this week. After looking at the chart it suspect the uptrend may be over. A new series of lower lows and lower highs has started to emerge which I don’t like the look of and as the saying goes “The trend is your friend until the bend in the end”. So at the moment I’m out of the market completely. I haven’t had a lot of time this week to look for new trades either with it being my first week back at work and all. Hopefully next week I’ll have some more time and will be able to find some good trades. I’ll keep you posted with how it goes.
