Trends And Targets

#Gold #Cac40 Animal behaviour cannot be predicted. One of our two ‘unwanted cats’ marched through the open office door, returning a moment later followed by our younger Golden Retriever. The cat made itself comfortable while the dog continued outside. Suddenly all hell broke loose when the dog “discovered” a very large black cat hiding at the wood shed. Once the inevitable noisy chase concluded, the dog proudly returned and the unwanted cat sauntered out to the garden.

There was no doubt the cat had employed the dog to chase an invader. But who could predict our ‘unwanted cats’ formed a co-operative pack with the dogs.

 

Of course, this brings us clumsily to our prediction for Cairn, given eleven months ago when it was trading at 173p. The price indeed reversed, eventually closing a session at 60.7p. While during the trading day, it fell to 57p, we feel the fact it did not close below 60p shall prove important. And yes, of course we’re chuffed at making this accurate prediction, especially as the bounce has seen the share price more than double.

 

We’re fascinated with price movements since the bottom was achieved at 60p. As the chart below highlights, the share has proven reticent about regaining the historical Red uptrend. Sometimes, when a price pays homage to a prior trend, any movement above such a level tends prove quite flamboyant. In the case of Cairn Energy, exceeding Red (presently 142p) should make travel to 162p almost a foregone conclusion. If exceeded, our secondary works out at 180p and presents a price level where we anticipate some hesitation occurring. Visually, it’s easy to imagine 180p bonking against the immediate Blue downtrend but more importantly, it also matches the false dawn spike of February 2020. This results in a situation where 180p presents itself as a “Glass Ceiling in Waiting!”.

 

For now, we’re fairly impressed with Cairn but we do need remind readers of 2 caveats. Firstly, we cannot calculate below 60p and secondly, despite our previous prediction, past performance is no guarantee of the future.

FUTURES

Time Issued	Market	Price At Issue	Short Entry	Fast Exit	Slow Exit	Stop	Long Entry	Fast Exit	Slow Exit	Stop	Prior
9:36:26PM	FTSE	6279									‘cess
9:39:30PM	BRENT	43.05
9:48:53PM	GOLD	1756.44	1742	1735.5	1726	1753	1764	1771	1780	1749	‘cess
9:51:02PM	FRANCE	4974.7	4897	4886	4846	4952	4987	4996.5	5020	4950
9:53:04PM	GERMANY	12362
9:54:43PM	US500	3124.27
9:56:23PM	DOW	26101
9:58:37PM	NASDAQ	10141									Success
10:00:23PM	JAPAN	22598									‘cess

22/06/2020 FTSE Closed at 6244 points. Change of -0.76%. Total value traded through LSE was: £ 5,301,930,883 a change of -54.04%

19/06/2020 FTSE Closed at 6292 points. Change of 1.09%. Total value traded through LSE was: £ 11,536,633,427 a change of 155.43%

18/06/2020 FTSE Closed at 6224 points. Change of -0.46%. Total value traded through LSE was: £ 4,516,542,486 a change of -22.67%

17/06/2020 FTSE Closed at 6253 points. Change of 0.18%. Total value traded through LSE was: £ 5,840,674,157 a change of -3.28%

16/06/2020 FTSE Closed at 6242 points. Change of 2.94%. Total value traded through LSE was: £ 6,038,997,708 a change of 21.55%

15/06/2020 FTSE Closed at 6064 points. Change of -0.67%. Total value traded through LSE was: £ 4,968,429,954 a change of -16.12%

12/06/2020 FTSE Closed at 6105 points. Change of 0.48%. Total value traded through LSE was: £ 5,923,571,843 a change of -4.84%

#Brent #Dax Lockdown inspires some strange behaviour. When my wife suggested we use our privacy to video something we’ve never, ever, done, the concept was only approached with the support of a decent amount of rum. What sort of bloke lets his wife sing while he plays guitar!  It proved quite funny, wife suffering from crushing shyness over her (rather impressive) singing voice, me similarly inhibited with my guitar work.

Somehow or other, we’ve gone through nearly 3 decades of marriage without trying this but a “good idea” to video record something funny for her Mum (in Care Home isolation) ensured an entire weekend was spent, rehearsing something which lasted just 2 minutes 16 seconds***. The jury is pretty firmly out as to whether we shall ever do the same again but the event spawned another idea. What if the FTSE were looked at with optimism, rather than the usual misery it deserves?

 

It would be true to say the constant rehearsals caused a bored mind to wander but the results, after taking quite a different view of the FTSE, were to prove interesting.

 

Of course, we’d be remiss if we ignored the glaringly obvious.

The Red line on the chart highlights where the FTSE would be, had it continued to copy Dow Jones movements but in 2013 everything changed. Wall Street continued heading upward with incredible strength. The FTSE didn’t. Had the UK market remained following the US market, the FTSE would have nearly reached 14,000 points before Covid-19 hit. In reality, the FTSE managed 7,500 points before the collapse.

In the period since the Covid-19 drop, the Nasdaq and S&P have exceeded their pre-drop levels. The Dow Jones has not and neither has the FTSE. The DOW has certainly been trying its best to recover but we’ve a couple of alarm bells ringing due to some recent dance steps.

However, should the FTSE manage to exceed 6,750 points, it enters a cycle where we are supposed to plan for recovery to 8,221 points initially with secondary, if bettered, at 8,728 points. Such movement will take the index into a region where 10,180 presents itself as a major point of long term interest. These figures are based entirely on FTSE movements since 2013, utterly ignoring how Wall Street behaves. It’s clear the last seven years has seen the two index’s execute a pretty solid divorce, making us wonder if the two markets had tried to sing and play guitar together!

 

We’ve a pretty solid suspicion the UK market closing a session above 6,750 shall prove improbable, resulting in the situation where there’s an attraction coming from a bottom of 3,900 points or so, just requiring negative sentiment to force a drop.

 

*** We recorded a tune called Caledonia, apparently one of her mothers favourites.

 

 

FUTURES

Time Issued	Market	Price At Issue	Short Entry	Fast Exit	Slow Exit	Stop	Long Entry	Fast Exit	Slow Exit	Stop	Prior
6:05:16PM	BRENT	41.93	41	40.355	39.5	41.62	42.92	43.235	43.55	41.74	Success
6:07:28PM	GOLD	1744									‘cess
6:09:06PM	FTSE	6210									‘cess
6:10:35PM	FRANCE	4927.2									Success
6:12:48PM	GERMANY	12116	12104	12009	11864	12266	12335	12473	12770	12185
6:15:28PM	US500	3070.02									Shambles
6:31:16PM	DOW	25639									Shambles
6:34:58PM	NASDAQ	9938									Success
6:37:13PM	JAPAN	22317									Success

 

19/06/2020 FTSE Closed at 6292 points. Change of 1.09%. Total value traded through LSE was: £ 11,536,633,427 a change of 155.43%

18/06/2020 FTSE Closed at 6224 points. Change of -0.46%. Total value traded through LSE was: £ 4,516,542,486 a change of -22.67%

17/06/2020 FTSE Closed at 6253 points. Change of 0.18%. Total value traded through LSE was: £ 5,840,674,157 a change of -3.28%

16/06/2020 FTSE Closed at 6242 points. Change of 2.94%. Total value traded through LSE was: £ 6,038,997,708 a change of 21.55%

15/06/2020 FTSE Closed at 6064 points. Change of -0.67%. Total value traded through LSE was: £ 4,968,429,954 a change of -16.12%

12/06/2020 FTSE Closed at 6105 points. Change of 0.48%. Total value traded through LSE was: £ 5,923,571,843 a change of -4.84%

11/06/2020 FTSE Closed at 6076 points. Change of -4%. Total value traded through LSE was: £ 6,224,767,909 a change of 0.67%

 

#FTSE #Nasdaq Numbers are funny things. The Nasdaq exceeds 10,000 points and it’s front page news. Politicians kill 64,500 people in the UK and 98,000 people in the USA, the media try to ignore it. Thankfully, even the BBC appear to be taking note of Boris’s world beating number, publishing their own analysis, matching the FT’s on the true number of UK deaths. Pro-rata, Boris has beaten Trump hands-down when it comes to killing of the population.

But we’re a little unsettled at a stock market achieving all time highs against a backdrop of record unemployment, funeral counts testifying as to how effective Boris has been in protecting the populace. The recovery of the FTSE from the Covid-19 lows in March makes us question how a country can be rated, neither excessive deaths, excess unemployment, excess business closures and excess liquidations making it feel like we’re in the grips of a Ponzi scheme, one of these things which end very badly with the realisation the emperor has no clothes.

To return to the reasoning for this immediate bout of confusion, the Nasdaq now looks capable of continued growth to 11,211 points. If exceeded, secondary is at 11,840 points and we can’t calculate any higher. Go figure! We would advocate a lot of caution, if the market gaps the Nasdaq below 9620 anytime soon.

, it’s worth remembering our Big Picture calculation demands the UK market exceed 6,750 before recovery can be taken seriously. Equally, below 6030 gives the first indication recovery is failing.

Near term, above 6,280 should prove capable of recovery continuing to an initial 6320 points. If exceeded, our secondary calculation works out at 6373 points. If triggered, the tightest stop is horribly wide at 6184 points. Perhaps 6245 will suffice but with the market producing volatile swings, we’re less than confident.

Below 6184 looks capable of triggering reversal to an initial useless 6160 points. If broken, secondary calculates at 6110 points and we’d hope for some sort of bounce at such a level.

Have a good weekend.

 

 

FUTURES

Time Issued	Market	Price At Issue	Short Entry	Fast Exit	Slow Exit	Stop	Long Entry	Fast Exit	Slow Exit	Stop	Prior
9:33:59PM	BRENT	41.52	40.35	40.105			41.61	41.74
9:36:43PM	GOLD	1723.88	1717	1711			1732	1738.5			‘cess
9:39:11PM	FTSE	6215.27	6180	6159.5			6276	6287			‘cess
9:41:36PM	FRANCE	4949.2	4903	4890			4980	4995.5			‘cess
9:43:31PM	GERMANY	12266	12157	12040.5			12483	12614.5			‘cess
9:45:49PM	US500	3111	3084	3071.5			3136	3164			Success
9:49:36PM	DOW	26068	25746	25484.5			26301	26671			‘cess
9:51:58PM	NASDAQ	10004	9877	9812			10042	10057.5
9:54:54PM	JAPAN	22387	22087	22033.5			22519	22539			‘cess

 

18/06/2020 FTSE Closed at 6224 points. Change of -0.46%. Total value traded through LSE was: £ 4,516,542,486 a change of -22.67%

17/06/2020 FTSE Closed at 6253 points. Change of 0.18%. Total value traded through LSE was: £ 5,840,674,157 a change of -3.28%

16/06/2020 FTSE Closed at 6242 points. Change of 2.94%. Total value traded through LSE was: £ 6,038,997,708 a change of 21.55%

15/06/2020 FTSE Closed at 6064 points. Change of -0.67%. Total value traded through LSE was: £ 4,968,429,954 a change of -16.12%

12/06/2020 FTSE Closed at 6105 points. Change of 0.48%. Total value traded through LSE was: £ 5,923,571,843 a change of -4.84%

11/06/2020 FTSE Closed at 6076 points. Change of -4%. Total value traded through LSE was: £ 6,224,767,909 a change of 0.67%

10/06/2020 FTSE Closed at 6329 points. Change of -0.14%. Total value traded through LSE was: £ 6,183,586,009 a change of -20.17%

 

 

 

 

#France #Nasdaq HSBC, UK based, do not appear to be missing many own goals at present. Their stance on China interference in Hong Kong, criticised by both UK and US governments was trumped, when they announced 35,000 job cuts as a “thank you” for staff efforts during lockdown. We can only wonder if they intend make negative comment on BLM, a statue somewhere, or the (often silly) debate over the number of biological genders.

 

However, thus far it appears their share price has not succumbed to temptation and flung itself into the sea. Perhaps the real problem lies below 358p, the immediate drop target. According to our calculations, 358p is liable to prove extremely problematic for the price as movement below risks triggering reversal to an initial 302p. Visually, this is extremely dangerous as it takes the price below the level of the financial crash in 2009, opening the doors for 165p to make an appearance as “ultimate” bottom.

Of course, Ultimate Bottom provides no certainty a share price will rebound. It’s one of these numbers we simply cannot presently calculate anything below!

 

Perhaps it’s the case the recent lows of 370p are deemed “close enough” to 358p by a market which perceives some strength in HSBC. If this is indeed the case, the share price needs exceed 394p (at time of writing, it’s 382p) as this calculates with an ambition of 410p. In the event this initial target level is exceeded, the price ticks the first box for bottom being “in” and allows a secondary calculation up at 436p.

 

For now, we suspect HSBC shall doubtless find an excuse to explore 358p and hopefully the market appreciates the price is staring into an abyss, thus forcing a strong recovery.

 

 

FUTURES

Time Issued	Market	Price At Issue	Short Entry	Fast Exit	Slow Exit	Stop	Long Entry	Fast Exit	Slow Exit	Stop	Prior
9:53:37PM	BRENT	40.6
10:00:39PM	GOLD	1727.23									‘cess
10:03:03PM	FTSE	6234.21									Sorry
10:05:11PM	FRANCE	4974	4948	4933.5	4902	5014	5028	5041.25	5093	4977	‘cess
10:07:08PM	GERMANY	12355.37
10:08:44PM	US500	3118
10:10:26PM	DOW	26168
10:27:10PM	NASDAQ	9995	9928	9887	9830	10020	10058	10085	10132	9995	‘cess
10:37:28PM	JAPAN	22470									‘cess

 

 

17/06/2020 FTSE Closed at 6253 points. Change of 0.18%. Total value traded through LSE was: £ 5,840,674,157 a change of -3.28%

16/06/2020 FTSE Closed at 6242 points. Change of 2.94%. Total value traded through LSE was: £ 6,038,997,708 a change of 21.55%

15/06/2020 FTSE Closed at 6064 points. Change of -0.67%. Total value traded through LSE was: £ 4,968,429,954 a change of -16.12%

12/06/2020 FTSE Closed at 6105 points. Change of 0.48%. Total value traded through LSE was: £ 5,923,571,843 a change of -4.84%

11/06/2020 FTSE Closed at 6076 points. Change of -4%. Total value traded through LSE was: £ 6,224,767,909 a change of 0.67%

10/06/2020 FTSE Closed at 6329 points. Change of -0.14%. Total value traded through LSE was: £ 6,183,586,009 a change of -20.17%

9/06/2020 FTSE Closed at 6338 points. Change of -2.07%. Total value traded through LSE was: £ 7,746,073,267 a change of -2.7%

 

 

#FTSE #Japan This share price has received rather a hammering. When we last reviewed #Glencore in September 2019, we whimsically completed our report (link) with the two sentences below;

As can be guessed, tacking this on at the very end of a 500 word report was “just” us covering ourselves in case it all went wrong. But somehow or other, the criteria we’d given for the share price being trashed seems to have been aware of the coming pandemic and Glencore’s share price duly obliged with a movement lemmings would be proud of. In the cold light of day, Glencore actually broke our 132p, eventually opting to bounce from 110p.

The big question, obviously, is to discuss whether the current bounce can be regarded as having any integrity. After all, our 132p ambition was broken on the initial surge downward, implying greater weakness is possible in the future. Despite this gloomy potential, we can report the rebound appears to have legs and we calculate strength now exceeding 182p should reach for an initial 204p. Our secondary ambition, should such a target be exceeded, works out at a rather more flamboyant 254p.

While 254p has a nice ring to it, it’s worth pointing out the visual cues should such a level be attained. Since November last year, this price level has formed a vague “glass ceiling” with the result some hesitation is very probable if the price makes such a lunge upward.

 

Hopefully this time around, we shall not again curse the price by gluing our caveat to the end of this report. Glencore needs trade below 156p to justify a raised eyebrow as this threatens coming weakness to an initial dangerous 142p. If broken, secondary calculates at a rather poisonous 114p, meeting the uptrend since 2016…

 

FUTURES

Time Issued	Market	Price At Issue	Short Entry	Fast Exit	Slow Exit	Stop	Long Entry	Fast Exit	Slow Exit	Stop	Prior
9:57:23PM	BRENT	40.83									Success
9:59:46PM	GOLD	1727									Shambles
10:08:44PM	FTSE	6242	6181	6177	6148	6244	6271	6316.5	6446	6183	Success
10:33:31PM	FRANCE	4946									Success
10:35:51PM	GERMANY	12292									Success
10:38:59PM	US500	3125.97									Success
10:41:38PM	DOW	26272									Success
10:43:36PM	NASDAQ	9960									Success
10:46:06PM	JAPAN	22327	22168	22027	21835	22409	22603	22724.75	22784	22374	Success

16/06/2020 FTSE Closed at 6242 points. Change of 2.94%. Total value traded through LSE was: £ 6,038,997,708 a change of 21.55%

15/06/2020 FTSE Closed at 6064 points. Change of -0.67%. Total value traded through LSE was: £ 4,968,429,954 a change of -16.12%

12/06/2020 FTSE Closed at 6105 points. Change of 0.48%. Total value traded through LSE was: £ 5,923,571,843 a change of -4.84%

11/06/2020 FTSE Closed at 6076 points. Change of -4%. Total value traded through LSE was: £ 6,224,767,909 a change of 0.67%

10/06/2020 FTSE Closed at 6329 points. Change of -0.14%. Total value traded through LSE was: £ 6,183,586,009 a change of -20.17%

9/06/2020 FTSE Closed at 6338 points. Change of -2.07%. Total value traded through LSE was: £ 7,746,073,267 a change of -2.7%

8/06/2020 FTSE Closed at 6472 points. Change of -0.19%. Total value traded through LSE was: £ 7,960,814,062 a change of 13.86%

 

 

#Gold #SP500 Such is our confidence in market direction, we’re opting to take a weekly review of the 2 leading shares in the retail bank sector in the hope of getting a clue what’s happening. Unlike Brent & Gold, the banking sector has tended avoid flamboyant movements since the Covid-19 drop, so we hope it shall prove a bellwether (the leading sheep in a flock) for future market direction.

 

The cunning plan is to try and identify a near term movements, capable of triggering a Big Picture movement. Unfortunately, the downward spike at the open of business for this week doesn’t feel capable of giving fireworks, instead probably just keeping the share price messing around to convince the market it’s trading. This strategy tends accomplish very little, other than to give a feel for change in market direction. What’s utterly key is the signal given, if one of our near term movements is substantially bettered. This sort of thing can often imply the first real signal for shift in market trend.

On an immediate basis, apparently moves next above 117p should provide a climb to an initial 119p with secondary, if exceeded, calculating at 122p. As the chart below highlights, neither ambition is particularly useful in itself, the price not being lifted into the land of Higher Highs. Instead, such a gain just keeps the share price marching on the spot.

 

Normally, a spike down on a price at the start of a trading week should give some hope but in the case of Barclays, we’re not sold. The price only needs drift below 111p to suggest coming weakness to an initial 107p with secondary, when broken, working out at 98p and hopefully some sort of rebound. The bigger problem comes should the share close below 98p for any reason as best hope for a bottom works out at 83p.

 

Next week, we shall again review what’s happening with Lloyds Bank.

 

 

FUTURES

Time Issued	Market	Price At Issue	Short Entry	Fast Exit	Slow Exit	Stop	Long Entry	Fast Exit	Slow Exit	Stop	Prior
10:07:50PM	BRENT	39.94
10:09:42PM	GOLD	1725.69	1716	1711	1705	1724	1730	1734	1744	1717	Success
10:13:02PM	FTSE	6148.85									Shambles
10:26:05PM	FRANCE	4877									‘cess
10:30:39PM	GERMANY	12123									‘cess
10:45:03PM	US500	3080.02	2962	2880	2762	3050	3081	3108	3166	2996	‘cess
10:48:34PM	DOW	25871.5									Success
10:52:53PM	NASDAQ	9826.37									Success
10:55:24PM	JAPAN	21950									Success

 

15/06/2020 FTSE Closed at 6064 points. Change of -0.67%. Total value traded through LSE was: £ 4,968,429,954 a change of -16.12%

12/06/2020 FTSE Closed at 6105 points. Change of 0.48%. Total value traded through LSE was: £ 5,923,571,843 a change of -4.84%

11/06/2020 FTSE Closed at 6076 points. Change of -4%. Total value traded through LSE was: £ 6,224,767,909 a change of 0.67%

10/06/2020 FTSE Closed at 6329 points. Change of -0.14%. Total value traded through LSE was: £ 6,183,586,009 a change of -20.17%

9/06/2020 FTSE Closed at 6338 points. Change of -2.07%. Total value traded through LSE was: £ 7,746,073,267 a change of -2.7%

8/06/2020 FTSE Closed at 6472 points. Change of -0.19%. Total value traded through LSE was: £ 7,960,814,062 a change of 13.86%

5/06/2020 FTSE Closed at 6484 points. Change of 2.26%. Total value traded through LSE was: £ 6,991,891,155 a change of 13.09%

 

#Brent #DAX It was an odd weekend with demonstrators in Parliament Square, London  ‘protecting’ a boxed Churchill statue, some giving Nazi salutes. We’ve not noticed groups of Nazis getting so worked up over a sealed box since ‘Raiders of the Lost Ark’ hit the big screen. Will the UK ever rebuild and can it involve some protestors brains?

 

This brings us to Taylor Wimpey, along with the big question of whether building companies will get restarted properly with lockdown easing. An acquaintance in the trade has been experiencing a problem with suppliers, two of whom announced they are not reopening and instead, opting for liquidation. Making matters worse, she has been experiencing difficulty sourcing replacement suppliers in Europe and it makes us suspect the building industry is about to face some peculiar times.

Taylor Wimpey had a superb start to 2020 and until Covid-19, things were looking especially hopeful for the longer term. Suddenly, it all came crashing down and a share price which had been starting to illustrate over 4 quid as a reasonable big picture ambition proved as stable as one of these houses built above decaying cliffs in the South. From our perspective, matters were made worse by the share price experiencing a GaGa, Gap Up then Gap Down, circled on the chart. This absurd series of price movements is usually quite reliable in allowing us to predict future target levels.

In the case of Taylor Wimpey, the two gaps generated sufficient weakness to attempt an initial 88p with secondary, when broken, at a bottom hopefully at 47p. None of this has actually happened (yet) as the lowest the price reached was Red on the chart, an uptrend since 2008. We’re not inclined to relax just yet as Taylor Wimpey need trade above 170p to generate an initial attempt at 183. If the share price exceeds 183p, this gives the first indication our GaGa gloom is probably nonsense, moving the price into a zone where movement above allows a further surge to 183p.

 

We fear it’s more likely any future break of Red, presently 103p, shall now bring reversal to an initial 88p with secondary, when broken, at a bottom hopefully of 47p. We’ve painted 20p as “ultimate” bottom on the chart, this being the level we cannot calculate below.

 

FUTURES

Time Issued	Market	Price At Issue	Short Entry	Fast Exit	Slow Exit	Stop	Long Entry	Fast Exit	Slow Exit	Stop	Prior
4:39:41PM	BRENT	39.08	37.11	36.125	34.98	38.7	39.56	40.065	41.05	38.23	Shambles
4:41:16PM	GOLD	1731
4:44:25PM	FTSE	6131.6									Success
4:54:00PM	FRANCE	4856.7									Success
5:07:19PM	GERMANY	12008.91	11824	11684	11520	11974	12174	12224.5	12383	11987	Success
5:28:58PM	US500	3037.52									Success
5:31:35PM	DOW	25561									Success
5:33:50PM	NASDAQ	9647.24									Success
5:35:46PM	JAPAN	22189									Success

12/06/2020 FTSE Closed at 6105 points. Change of 0.48%. Total value traded through LSE was: £ 5,923,571,843 a change of -4.84%

11/06/2020 FTSE Closed at 6076 points. Change of -4%. Total value traded through LSE was: £ 6,224,767,909 a change of 0.67%

10/06/2020 FTSE Closed at 6329 points. Change of -0.14%. Total value traded through LSE was: £ 6,183,586,009 a change of -20.17%

9/06/2020 FTSE Closed at 6338 points. Change of -2.07%. Total value traded through LSE was: £ 7,746,073,267 a change of -2.7%

8/06/2020 FTSE Closed at 6472 points. Change of -0.19%. Total value traded through LSE was: £ 7,960,814,062 a change of 13.86%

5/06/2020 FTSE Closed at 6484 points. Change of 2.26%. Total value traded through LSE was: £ 6,991,891,155 a change of 13.09%

4/06/2020 FTSE Closed at 6341 points. Change of -0.64%. Total value traded through LSE was: £ 6,182,855,691 a change of -6.26%