The fumbling FTSE, news from Europe
Gloomy chart watchers see 4,900 as next step
BY NICK HASELL
CITY chart-watchers believe that yesterday’s fall means the FTSE 100 is likely to tumble to 4,900 or below over the next two months. Chris Chaitow, technical analyst at Collins Stewart, the broker, described the 112-point retreat as a “confirmed break of key support levels”. As it has fallen through 5,280 and closed below 5,250, he expects the index to touch 4,900 over the next six to eight weeks.
He said that London was following the pattern of other major stock markets, such as Frankfurt and Hong Kong, which have already fallen through their year lows. That leaves the Nasdaq and S&P as the only key indices that have yet to test the bottom of their recent range.
Richard Crossley, an analyst at Teather & Greenwood, is even more gloomy, and sees 4,800 as the next stop on the charts after yesterday’s close below the FTSE 100’s end-July lows. He said the breach of support levels was “serious”, and expects it “to set the tone in the UK equity market for some time”. He did not give a date by which he expects his target to be met, but predicted it would be a case of sooner rather than later.
As well as the direction of indices, chartists also pay heed to volume of shares changing hands. Yesterday’s turnover in London was the highest since early July, which was viewed as another negative sign. Mr Crossley also noted that Nasdaq volumes have swollen over recent sessions.
thetimes.co.uk |
