FTSE remains neutral

Price at time of writing - 6308.

Another difficult week for the FTSE is further evidence of the soft patch triggered by the recent break below support (ie the band defined as 6491-6556).

The 104-point weekly fall has left the index mired about 8.33% below its May peak. As suggested last week, the FTSE now faces some tough grind as it claws its way back above this important band, and my recommendation to avoid the index until it does so remains valid.

In my view, a changing of the guard at the Bank of England's top table can't come quickly enough. It was inevitable that, following the global financial crisis, financial services regulation would swing much too far in the other direction (as it always does when politicians are involved). However, after five long years, I believe it is time to drop the politics of envy and allow the banking sector a clear path, free from ever-changing, politically-inspired regulation. Forever blaming the banks for past mistakes (rightly or wrongly) is not productive, and I believe the new American governor of the Bank is keenly aware of this need.

There is little to add to today's chart. In the meantime, we should continue to wait for a lower-risk opportunity before opening any new FTSE positions.

Recommendation: Neutral. Buy only on a break above 6556, or on a further fall to 6056, whichever occurs first. The target then becomes 6922.

FTSE 100 chart

Disclaimer

This information has been prepared by IG, a trading name of IG Markets Ltd. Registered Office: Cannon Bridge House, 25 Dowgate Hill, London, EC4R 2YA. IG Markets Ltd is a company registered in England and Wales under number 04008957. We are authorised and regulated by the Financial Services Authority (FSA No: 195355).

No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. The research does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it.

It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. This communication must not be reproduced or further distributed.

 

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen. 79% van de retailbeleggers lijdt verlies op de handel in CFD’s met deze aanbieder.
Het is belangrijk dat u goed begrijpt hoe CFD's werken en dat u nagaat of u zich het hoge risico op verlies kunt permitteren.
CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen.