Tag Archives: ftse 2014 trend

FTSE Elliott Wave Technical Analysis – 7th May, 2014

Upwards movement continues as expected. The short term target is 6,853. The target for upwards movement to end remains at 7,345.

Movement above 6,865.86 would provide full and final confidence that the intermediate degree trend is up.

Click on charts to enlarge.

FTSE monthly 2014

This main wave count expects that FTSE remains within a huge super cycle expanded flat correction. My alternate idea would be more in line with my bullish main wave count for the S&P 500: the FTSE may have ended its correction at 3,460.71 in March 2009 and that may be where a new bull market began.

The subdivisions and expectations for the mid term are the same for both ideas and so I will publish only one at this stage. When the next intermediate degree wave upwards is complete then I would use the lower edge of the maroon channel to differentiate between a long term bullish and bearish outlook. A bull market should breach the upper edge of this maroon channel, and it may not breach the lower edge. A bear market should breach the lower edge of this maroon channel.

If this upwards movement is a zigzag for a cycle degree b wave then it is incomplete. At 7,103.67 or above cycle wave b would reach 105% the length of cycle wave a. This would see the flat an expanded flat which is the most common type, and so movement above this point is reasonably likely.

In the mid term if we see more downwards movement then intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement below 5,989.07.

FTSE daily 2014

Intermediate wave (4) may have ended as a running barrier triangle with the B-D trend line essentially flat.

Following a barrier triangle in a fourth wave position the fifth wave is often either a short sharp movement, or an exceptionally long extension. A long extended fifth wave would be less likely in this case as that would make cycle wave b longer than the maximum common length of 138% the length of cycle wave a (cycle waves seen on the monthly chart). So a short sharp fifth wave (relative to intermediate waves (1) and (3)) is more likely.

At 7,345 intermediate wave (5) would reach equality with the widest part of the triangle.

A new high above the end of minor wave D of the triangle at 6,865.86 would confirm that the triangle is over and intermediate wave (5) is underway.

So far within intermediate wave (5) minor wave 1 subdivides as a leading contracting diagonal, and minor wave 2 as a deep zigzag. Following leading diagonals in first wave positions second waves are normally very deep, so this wave count has a typical look.

At 6,853 minor wave 3 would reach 1.618 the length of minor wave 1.

Within minor wave 3 minute wave iv may not move into minute wave i price territory. When minor wave 3 is completed (as soon as a new high above 6,838.17 is seen then minor wave 3 could be complete) then the invalidation point must move to the high of minor wave 1 at 6,706.34. Minor wave 4 may not move into minor wave 1 price territory.

FTSE hourly 2013

Minor wave 3 is unfolding as a typical looking impulse, so far.

It may be as labeled here, or minute wave iii may be incomplete and may extend higher. That would fit better with momentum.

Minute wave iv may not move into minute wave i price territory below 6,724.58.

FTSE Elliott Wave Technical Analysis – 21st April, 2014

Upwards movement continues as expected. So far upwards movement from the low at 6,492.62 subdivides best as a five, and downwards movement looks extremely clear as a three. This provides me with some confidence in a trend change at 6,492.62.

Movement above 6,865.86 would provide full and final confidence that the intermediate degree trend is up.

Click on charts to enlarge.

FTSE monthly 2013

This main wave count expects that FTSE remains within a huge super cycle expanded flat correction. My alternate idea would be more in line with my bullish main wave count for the S&P 500: the FTSE may have ended its correction at 3,460.71 in March 2009 and that may be where a new bull market began.

The subdivisions and expectations for the mid term are the same for both ideas and so I will publish only one at this stage. When the next intermediate degree wave upwards is complete then I would use the lower edge of the maroon channel to differentiate between a long term bullish and bearish outlook. A bull market should breach the upper edge of this maroon channel, and it may not breach the lower edge. A bear market should breach the lower edge of this maroon channel.

If this upwards movement is a zigzag for a cycle degree b wave then it is incomplete. At 7,103.67 or above cycle wave b would reach 105% the length of cycle wave a. This would see the flat an expanded flat which is the most common type, and so movement above this point is reasonably likely.

In the mid term if we see more downwards movement then intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement below 5,989.07.

FTSE daily 2013

Intermediate wave (4) may have ended as a running barrier triangle with the B-D trend line essentially flat.

Following a barrier triangle in a fourth wave position the fifth wave is often either a short sharp movement, or an exceptionally long extension. A long extended fifth wave would be less likely in this case as that would make cycle wave b longer than the maximum common length of 138% the length of cycle wave a (cycle waves seen on the monthly chart). So a short sharp fifth wave (relative to intermediate waves (1) and (3)) is more likely.

At 7,345 intermediate wave (5) would reach equality with the widest part of the triangle.

A new high above the end of minor wave D of the triangle at 6,865.86 would confirm that the triangle is over and intermediate wave (5) is underway.

Within intermediate wave (5) no second wave correction may move beyond the start below 6,492.62.

FTSE hourly 2013

This hourly chart focusses on the movement since the end of the triangle for intermediate wave (4).

The first upwards wave for minor wave 1 subdivides nicely as a leading contracting diagonal. All the subwaves are zigzags. The diagonal is clearly contracting, and the trend lines converge.

Following a leading diagonal in a first wave position the second wave is commonly very deep. Minor wave 2 subdivides as a zigzag and is a very deep 93% correction of minor wave 1.

The blue channel is a base channel drawn about minor waves 1 and 2. Minor wave 3 should breach the upper edge of the base channel. After the channel is breached the upper trend line should provide support. Minor wave 3 should show a clear and strong increase in upwards momentum beyond that seen for minor wave 1.

Within minor wave 3 downwards corrections should find support at the lower edge of the base channel.

At 6,852.88 minor wave 3 would reach 1.618 the length of minor wave 1.

Within minor wave 3 no second wave correction may move beyond its start below 6,507.08.

FTSE Elliott Wave Technical Analysis – 31st March, 2014

Price continues to move higher, but the breakout is unconvincing. A new high above 6,865.86 would be required to provide confirmation of this trend change at intermediate degree.

The target for upwards movement is now 7,345.

Click on charts to enlarge.

FTSE monthly 2013

This main wave count expects that FTSE remains within a huge super cycle expanded flat correction. My alternate idea would be more in line with my bullish main wave count for the S&P 500: the FTSE may have ended its correction at 3,460.71 in March 2009 and that may be where a new bull market began.

The subdivisions and expectations for the mid term are the same for both ideas and so I will publish only one at this stage. When the next intermediate degree wave upwards is complete then I would use the lower edge of the maroon channel to differentiate between a long term bullish and bearish outlook. A bull market should breach the upper edge of this maroon channel, and it may not breach the lower edge. A bear market should breach the lower edge of this maroon channel.

If this upwards movement is a zigzag for a cycle degree b wave then it is incomplete. At 7,103.67 or above cycle wave b would reach 105% the length of cycle wave a. This would see the flat an expanded flat which is the most common type, and movement above this point is reasonably likely.

In the mid term if we see more downwards movement then intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement below 5,989.07.

FTSE daily 2013

Intermediate wave (4) may have ended a few days ago as a running barrier triangle with the B-D trend line essentially flat.

If this wave count holds (if price does not move below 6,478.16) then the target is at 7,345 where intermediate wave (5) would reach equality with the widest part of the triangle.

Fifth waves following barrier triangles are either short, sharp movements, as this target suggests, or long extensions. A short, sharp movement would bring cycle wave b nicely into the common length of 100% to 138% the length of cycle wave a.

A new high above the end of minor wave D within the triangle at 6,865.86 would confirm that the triangle is over and intermediate wave (5) is underway.

If minor wave E of the triangle moves any lower it may not move beyond the end of minor wave C at 6,478.16. Movement below this point would invalidate the triangle.

Normally when triangles are complete the next movement begins with a sharp thrust. This has not happened so far and so this week I have some doubt about whether or not intermediate wave (4) is over. If a new low below 6,478.16 is seen in the next week then I would expect that intermediate wave (4) may be continuing sideways as a combination.

FTSE Elliott Wave Technical Analysis – 19th March, 2014

Price moved lower as expected. The target was 6,486. Downwards movement reached 6,500 two days ago and has since moved higher.

However, a new high above 6,865.86 would be required to provide confirmation of this trend change at intermediate degree.

The target for upwards movement is now 7,352.

Click on charts to enlarge.

FTSE monthly 2013

This main wave count expects that FTSE remains within a huge super cycle expanded flat correction. My alternate idea would be more in line with my bullish main wave count for the S&P 500; FTSE may have ended its correction at 3,460.71 in March 2009 and that may be where a new bull market began.

The subdivisions and expectations for the mid term are the same for both ideas and so I will publish only one at this stage. When the next intermediate degree wave upwards is complete then I would use the lower edge of the maroon channel to differentiate between a long term bullish and bearish outlook. A bull market should breach the upper edge of this maroon channel, and it may not breach the lower edge. A bear market should breach the lower edge of this maroon channel.

If this upwards movement is a zigzag for a cycle degree b wave then it is incomplete. At 7,103.67 or above cycle wave b would reach 105% the length of cycle wave a. This would see the flat an expanded flat which is the most common type, and so movement above this point is reasonably likely.

In the mid term if we see more downwards movement then intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement below 5,989.07.

FTSE daily 2013

Intermediate wave (4) may have ended two days ago as a running barrier triangle with the B-D trend line essentially flat.

If this wave count holds (if price does not move below 6,478.16) then the target is at 7,352 where intermediate wave (5) would reach equality with the widest part of the triangle.

Fifth waves following barrier triangles are either short, sharp movements, as this target suggests, or long extensions. A short, sharp movement would bring cycle wave b nicely into the common length of 100% to 138% the length of cycle wave a.

A new high above the end of minor wave D within the triangle at 6,865.86 would confirm that the triangle is over and intermediate wave (5) is underway.

If minor wave E of the triangle moves any lower it may not move beyond the end of minor wave C at 6,478.16. Movement below this point would invalidate the triangle.

FTSE Elliott Wave Technical Analysis – 21st February, 2014

This upwards movement cannot be a leading diagonal within intermediate wave (5) followed by a second wave correction because the leading diagonal wave lengths do not work.

Click on the charts below to enlarge.

FTSE daily 2013

It looks unlikely now that it is an incomplete flat correction for intermediate wave (4).

It may be a barrier triangle, but minor wave B looks out of proportion to minor waves C and D. This gives the wave count a slightly odd look.

If it is a barrier triangle then minor wave E may end about 6,486 where it is 85% the length of minor wave C. Minor wave E may not move beyond the end of minor wave C. The triangle is invalidated with movement below 6,478.16.

If the triangle is invalidated then it is just possible that intermediate wave (4) could be a double combination. However, that would see minor wave X within it also a double which is technically possible but very unusual. That wave count would have a very low probability.

Intermediate wave (4) may not move into intermediate wave (1) price territory. Movement below 5,989.07 would invalidate this wave count.

FTSE Elliott Wave Technical Analysis – 14th February, 2014

Last week’s analysis of FTSE expected more upwards movement to end about 6,695.25. Price moved higher as expected reaching 6,708.17, 12.92 points above the target.

I expect this correction is over and the downwards trend should resume. I am expecting to see an increase in downwards momentum over the next week towards 6,258. This target may be one to two weeks away.

Click on the chart below to enlarge.

FTSE Elliott Wave Chart 2013

Intermediate wave (4) may be completing as a regular flat correction which is reasonably common.

Within the flat minor waves A and B both subdivide as “threes”: minor wave A is a single zigzag and minor wave B is a double zigzag. Minor wave B is a 99% correction of minor wave A.

At 6,015 minor wave C would reach equality in length with minor wave A. It is very likely to make a new low below the end of minor wave A at 6,023.44 to avoid a truncation, although if it is truncated this would still be a regular flat and not a running flat.

Minor wave C may end at the lower edge of the parallel channel drawn about this flat correction.

Intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement below 5,989.07.

Minor wave C downwards must subdivide as a five wave structure, either a simple impulse or an ending diagonal. Within it the first wave labeled minute wave i subdivides best on the hourly chart as an impulse, and so minor wave C is most likely to be an impulse. An ending diagonal would require the first wave to subdivide as a zigzag.

Minute wave ii is now likely to be complete ending just above the 0.618 Fibonacci ratio of minute wave i. If minute wave ii is incomplete and extends further then it may not move beyond the start of minute wave i. This wave count is invalidated at minor degree with movement above 6,867.42.

FTSE Elliott Wave Chart 2013

Within minute wave ii the structure is a nicely completed three wave zigzag. Minuette wave (c) is 8.2 points longer than equality with minuette wave (a).

The channel drawn about this zigzag is clearly breached by downwards movement indicating a resumption of the downwards trend. The downwards movement subdivides perfectly as a five wave impulse, with an extended third wave. This is further indication that minute wave ii is most likely over and minute wave iii has most likely begun.

At 6,258 minute wave iii would reach equality in length with minute wave i.

Within minute wave iii subminuette wave ii may not move beyond the start of subminuette wave i. This wave count is invalidated at minute degree with movement above 6,708.17.

FTSE Elliott Wave Technical Analysis – 6th February, 2014

Last week’s analysis of FTSE expected more downwards movement. This is what has happened.

The target remains the same at 6,015 and this target is still about four to six weeks away. On the way down I expect two larger corrections, the first of these two has just begun and should move price a little higher.

Click on the chart below to enlarge.

FTSE Elliott Wave Chart 2013

Intermediate wave (4) may be completing as a regular flat correction which is reasonably common.

Within the flat minor waves A and B both subdivide as “threes”: minor wave A is a single zigzag and minor wave B is a double zigzag. Minor wave B is a 99% correction of minor wave A.

At 6,015 minor wave C would reach equality in length with minor wave A. It is very likely to make a new low below the end of minor wave A at 6,023.44 to avoid a truncation, although if it is truncated this would still be a regular flat and not a running flat.

Minor wave C may end at the lower edge of the parallel channel drawn about this flat correction.

Intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement below 5,989.07.

Minor wave C downwards must subdivide as a five wave structure, either a simple impulse or an ending diagonal. Within it the first wave labeled minute wave i subdivides best on the hourly chart as an impulse, and so minor wave C is most likely to be an impulse. An ending diagonal would require the first wave to subdivide as a zigzag.

Minute wave ii is incomplete, and it should show a clear three wave structure on the daily chart. It may not move beyond the start of minute wave i above 6,867.42. It may end about the 0.618 Fibonacci ratio of minute wave i at 6,695.25.

FTSE Elliott Wave Technical Analysis – 31st January, 2014

It is most likely that intermediate wave (4) is not over and will complete as a regular flat correction. The triangle scenario was invalidated. It is very likely that FTSE should drop below 6,023.44. The target is 6,015.

Click on the charts below to enlarge.

FTSE Elliott Wave Chart 2013

A large super cycle degree flat correction may be unfolding for super cycle wave II.

Within the flat cycle wave a is a zigzag with a truncated primary wave C.

Cycle wave b is an incomplete zigzag. Within it primary waves A and B are complete, primary wave C is incomplete.

Within primary wave C intermediate wave (4) is most likely incomplete. When it is done a final upwards wave for intermediate wave (5) would be likely to take price to 7,103.67 or above so that cycle wave b is 105% or longer than cycle wave a. This would see super cycle wave II as an expanded flat correction which is the most common type of flat.

Within primary wave C intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement below 5,989.07.

When I have confidence that intermediate wave (4) is over then I would use the ratios at intermediate degree within primary wave C to calculate a target for intermediate wave (5) to end.

FTSE Elliott Wave Chart 2013

Intermediate wave (4) is not a triangle, but it may be a regular flat correction which is reasonably common.

Within the flat minor waves A and B both subdivide as “threes”; minor wave A is a single zigzag, minor wave B is a double zigzag. Minor wave B is a 99% correction of minor wave A.

At 6,015 minor wave C would reach equality in length with minor wave A. It is very likely to make a new low below the end of minor wave A at 6,023.44 to avoid a truncation, although if it is truncated this would still be a regular flat and not a running flat.

Minor wave C may end at the lower edge of the parallel channel drawn about this flat correction.

Intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement below 5,989.07.

FTSE Elliott Wave Chart 2013

I publish this possible alternate mostly to play devil’s advocate. It has too many problems to be viable. I use it to illustrate why intermediate wave (4) is most likely not over because if intermediate wave (5) has begun then the subdivisions do not fit.

If intermediate wave (4) was over at 6,023.44 as a brief single zigzag then it shows little structural alternation with intermediate wave (2) which also fits best as a single zigzag.

If intermediate wave (5) began at 6,023.44 then the first wave up within it looks like it could be a leading diagonal. The problem with this idea is the wave lengths within the diagonal. The actionary waves i, iii and v are progressively shorter so this indicates the diagonal should be contracting, but the reactionary waves of ii and iv are progressively longer which indicates the diagonal should be expanding. It is neither expanding nor contracting and the trend lines look mostly parallel. This movement does not fit well at all as a diagonal. Only because the subdivisions fit would I consider this, and only then when all other possible alternates have been invalidated.

The diagonal would be extremely unlikely to be an ending diagonal because it is very rare to see fifth wave ending diagonals which end in a fifth wave truncation. If this diagonal is intermediate wave (5) as an ending diagonal then it failed slightly to move beyond the end of intermediate wave (3) at 6,875.62 by 8.2 points.