I wanted to write a post about the current position of the UK stock market to try to make sense of how investable UK stocks are right now? I thought maybe writing a post may help me to decide if now is actually a good time to buy good value stocks!
So as always I’m looking at the chart for a guide as to what to do. When looking at the chart it seems clear to me that the FTSE is in a state of decline right now.
Why is the FTSE in decline?
Weekly RSI is trading well below the mid point of 50
Long term and Short term MACD indicators are both below the 0 line
The current price is below the 200 day moving average
However, looking at the current price it does seem to be holding a position of support which it has found line with support levels back in October 2016 and then further back to April 2015. Looking at this support line it shows just how close the UK market is to slipping back into decline. I’m sure analysts will be watching the 7090 level with their finger hovering over the sell button.
Its also clear that the 50 day is about to challenge the 200 day moving average which will put more pressure on the down side.
So I think I’ve come to the conclusion that the current situation is a tense one and one that will need to be monitored. Its key right now that the price needs to come up above the 200 day average to stop the 50 dropping under. However I can’t see that happening in the short term.
As I see it we should be looking at spread betting opportunities for stocks to become sinkers (move down) but this is just my opinion. I’d love to hear your thoughts?
After a long period negativity for UK FTSE share Standard Chartered – STAN – times look like they might be changing. Typically I post weekly charts to show my thoughts but today I’d thought I’d share the monthly chart.
Monthly break out of price trend
Long term MACD broken above Zero line
Short term MACD test Zero line and recovered
So using the monthly chart in conjunction with the weekly chart is always a good thing to do when it comes to investing as the long term chart will give you a good idea of the short term direction of any stock.
Looking at STAN I identified them as being a swimmer (Buy) when I saw how the monthly fact stacked up. First of all by drawing a trend line between the high of March 13 and now its easy to spot how the current month appears to have broken a trend line.
Then as a second indicator of a trend break I looked for strength in the MACDs and they both show strength. The short term MACD shows how the zero line was put to the test recently but the share came out on top and is pushing higher.
Finally, the long term MACD shows a reversal to the upside of the trend and pushed passed the 0 line into positive territory giving me enough reason to buy this share as a spread bet.
Let me know your thoughts, I’d love to know if you agree.
UK FSTE Company BGEO Group last week hit a new 10 year high and looks to be a swimmer. This is some thing for a share that costs more the £30 per share.
So why this stock?
Weekly long term MACD hit a double bottom
Monthly MACDs both showing positive values
Price break to new high
MACDs are the indicators that play the part in this share, which made me buy into this company as a main share. Take a look at the image that supports this post, you’ll see something that I think is is a good positive sign of strength. The long term MACD has formed a kind of double ‘U’ shape! Take a look at how it twice went under the 0 line and then back above, but also see how it went down to the same place. Expect this to give strength to the share in the future.
Further strength in this share can be seen in the monthly chart, although I don’t show it the chart shows how the signal line has gone ‘green’ and has moved above the indicator line on both short and long term MACDs.
The only thing worrying me about this share is the 50 day moving average – I’ve owned the share for a week now and I’m still waiting for the 50 to move over the 200 day. Its close but I’ll be more comfortable owning the share when the cross happens.
As I always say, this is just my opinion, so let me know your thoughts!
UK FTSE Oil & Gas Company Cairn Energy finally broke through its downward trend this week.
Reasons to buy
Broken downward trend
Above weekly RSI support line
Long term MACD broke trend
I brought into this share earlier this week after having it on my watch list for some time. Patience has been the key here and I’m hoping the patience is going to pay off with this share. Since the back end of October the share has tried to break the weekly trend line it has been on but every week it ended up closing below the trend line.
When that pattern broke last week and the price close above the trend I decided it was time to get into this share as a new swimmer!
With both MACDs in positive positions it only adds strength to the reversal of the downward trend.
Finally the weekly RSI value has spent time testing and bouncing back up from the support line.
This is my opinion, I’d love to know if people think the same way as me, so let me know. I’ll report back on how I get on.
UK FTSE 100 Company Anglo America (AAL) is a new share I identified as a swimmer last week and since then the share has jumped nicely.
Reasons to buy
New 52 week high
Clear support line
Long term weekly MACD crossed to green
A number of factors add up to this stock being one to hold onto for a little while and none of the indicators are suggesting anything else right now.
Looking at the weekly chart above the long term weekly MACD value at the foot of the chart show how last week it crossed over from red to green showing momentum to the upside. Take a look also at the RSI value, it is sat above the support line and well above the 69 level. Again this is a good sign of momentum.
Looking at the current share price its difficult to see what the next test is going to be and it clearly shows the share tried to pass over 1600 over around a 1 year period back in 2014. Its taken 3 years to come back to the same level and now its broken free. We’ll just have to see if 1600 can be the new support level for this share. Time will tell, for now I’m staying with this share.
These thoughts are my thoughts, feel free to let me know what you think!
So today I thought I’d share some positive news about a share I purchased only 7 weeks ago!
UK AIM stock AB Dynamics is a share that has been sat month after month with a RSI value of over 68 so in a good position of strength. The share though had not move in any direction for 8 months. However when it broke out of the 8 month range I wrote how this one was a swimmer and I was going in on it as a main share to my portfolio.
7 weeks later the share grew my position by 40% and I sold it yesterday.
Why sell now?
I’m not greedy, I normally look for 30% growth in my main shares so I felt it was time to take the money and run!
I don’t feel I’m done with this share. The chart is still really positive and right across 1 day, weekly and monthly the RSI values are off the scale!
I feel now the share needs a rest period and looking how this exploded over the last 7 weeks that rest period will probably be short.
UK AIM Share Bluejay Mining – JAY – is a share I’ve held now since the back end of October – its price is very low at just 24p per share so it invites investment to those who like to look for growth in stocks that are really cheap.
I thought it would be good to write about JAY this week because of what has happened to them over the last 3 weeks. Take a look at the chart and you’ll see they have just come out of a rest period. Every share needs time to rest.
Looking at the weekly chart here you can see the rest took the RSI back to the 70 level and last week went back above this level . Investors would also be advised to take a look at the monthly chart as the share will also show how it has remained above the 70 RSI level since February showing real strength.
Reasons to be in this share:
RSI on weekly and monthly remain above 70
Weekly MACDs short term and longer term are green
Don’t just take my word for it though. Do your own research and maybe let me know your thoughts but for me this one is a swimmer!
UK Stock BBA is a share I’ve picked as a swimmer today as it looks to be in a position to finally break out from the locked range it has traded in since February.
Why buy this stock
Both MACDs show reasons to buy
All daily averages moving to positive
So the chart is a weekly chart and the MACDs seem to be showing good indicators. When you look closely at the short term MACD its movement has since July shown a couple of times where it has attempted to come up and over the 0 line. Finally, the short term MACD has gone over the 0 mark, you then can add to this what the long term MACD has just done. That has dropped all the way back to the 0 line and instead of carrying on down its found some support and not only has it found support but the bar chart is just starting to show the first positive green indicator it has had for a while.
What also shows with this share is the 3 daily average indicators have all come together, and appear set to split apart in a positive way. This is due to how currently the price is trading above the current set of daily averages as long as the price says above the averages they should split out nicely giving signs of a positive move.
Do your own research and let me know if you feel the same as I do.
UK AIM Stock AB Dynamics hit a new all time high at the end of last week which triggered my interest enough this week to buy this stock as a main share.
Weekly short term MACD nice under over 0 move
Weekly long term MACD stayed above 0 and moved positive
200 day average has supported well
Month RSI has stayed above 68 since October 2015
With results due in less that a months time this share has just moved outside of a stunted range for the first time since February, could the chart be showing an indication of what is to come?
This share has been on my watch list now for sometime, its impressive when you look at how the monthly RSI has remained above 68 since October 2015 and I’ve spoken previously about how RSI 70 isn’t necessarily always oversold and about to go down. This share shows that very well.
Also I take a positive from how the monthly chart shows how well the 200 day moving average supported this share last month and it closed right on the line!
Then looking at the weekly chart above the short term MACD showed how it previously tried to move above 0 and failed 5 candles ago but then had another go 2 candles ago and left behind it a very nice little curve.
Finally the longer term MACD gave me the last signal I needed and at the end of last week the bar chart turned from red to green.
These are my reasons for going into this share as a swimmer. Please do your own research!
Talk to most traders and most of them will tell you just how well they are doing and forget to tell you when they have a bad day at the office. Trust me when I say we all have bad trades, its about making sure the good ones out do the bad ones.
I thought today would be a good day to highlight a trade that went bad for me this week and took a drop following a profit warning issued by this company earlier this week.
However, its also a good opportunity to see what can be learnt from the stock to see if anything can be taken from this. So I took a look and I can now see the chart gave me clues when to get out and I only didn’t get out as I didn’t want to take a tiny loss, big mistake!
Take a look at the weekly chart to the right and pay attention firstly to the RSI and see how the breakout outline failed and a perfect little inverted V.
Then take a look at the last drop, this time it was this week, the time of the major drop. Its quite amazing how the chart seemed to know the profit warning was on its way.
Look at the short term MACD line here again at the same time as the RSI ran into problems the MACD had its own problems. I show a “clear warning” when the MACD failed to break the 0 line. Then just as the MACD has another go to break the 0 line you see how the long term MACD jumps into the picture.
This is the final nail in the coffin, the long term MACD hit too much pressure trying to get over 0 and then failed right at the time of the profit warning.
I think this highlights enough warning and maybe I should of got out of this share earlier, but when? Maybe when it dropped below the 200 day, or maybe as soon as it hit the first fail I highlighted.
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