Well I hope you have noted my Mr Micawber, gallows optimism about the FTSE over my previous pieces.
The FTSE and the UK is in a terrible mess but the prospect of upside are good in the UK market because it is ripe for overseas raiders to pillage.
The new governmental broom hasn’t even managed to brush the dirt under the carpet let alone turn around the sinking ship of state. Instead, it seems to have improved things worse. I won’t vituperate further because they are, however, inept, just people likely doing their best in a situation where the public sector is so big its is beyond the control of anyone, save the hive mind that drives it from within. How many people are capable of running a multi trillion-dollar business with 60 million employees? The task is on many levels a ‘fools errand.’
Its hard to ignore the decline of the motherland but if there is a solution it’s the market, so the best and most we can do is to be in the market and be that other hive mind that can make a difference.
So here is the thing, lets drop kick politics out of the equation and look to make some money.
Look at this:
What dark magic is this? OK so that is as near a breakout as I’ve seen since Bitcoin when mental last year when I wrote that up here. It says, yikes the UK market is on the cusp of repricing upwards a lot.
It suggests to me, QE is on the way or has perhaps happened already. Is it a UK QE or a US QE??? Its hard to know but it appears that the recent credit crunch, interest rate spikes are now in reverse suggesting we are going risk on. These days equities are driven by the sort of cashflows that pull down interest rates, so those recent falls in US treasure rates are perhaps indicative of a positive liquidity move. Such a move can be created by central banks but even now they can also be created by Mr Market who while junior to the central bankers remain the fundamental driver of these matters, even if their influence has been tamed.
What the chart looks like it is telling us is the FTSE might just be about to reprice 7-8% upwards which would be marvellous.
The FTSE 100 is now on the cusp of a significant break out to the upside. Technical analysis is never fate but the above chart set up was enough to make my spectacles fog up, so what comes next is going to be very interesting indeed and further rises will be very bullish indeed.