FTSE Forecast June 15, 2016, Technical Analysis
The FTSE fell during the course of the day on Tuesday, slicing through the 6000 level. That is a very strong sign that the sellers have taken over, and at this point in time I anticipate that it is probably based upon reports coming out of the United Kingdom that the referendum to leave the European Union may actually go through and as a result it’s likely that the market out there is starting to get fairly concerned, and the starting to sell things in a bit of worry as opposed to any types of earnings reports or anything like that. With this, I think that the market breaking below the 6000 level should send the FTSE looking for lower levels, and I believe that the 5800 level will be targeted next.
However, you have to keep in mind that we may very well get an announcement coming out of the United Kingdom saying that perhaps the general public won’t leave, and that of course would change everything. Currently, the polls have the people wanting to leave the European Union up by about 7%, which is a fairly significant number. Ultimately though, any type of massive selloff in the United Kingdom will more than likely offer a longer-term investment opportunity as leaving the European Union isn’t exactly the end of the world as the “stay” crowd would have you believe. After all, the real question after that isn’t going to be what happens to the United Kingdom, but what happens to the European Union as several other populations around the continent aren’t exactly happy with the current arrangement either.
Ultimately, I believe that this market will continue to drop but it will be very dependent on the latest headlines coming out of the pollsters, and that of course will change on an almost daily basis. So having said that, you’re going to have to be very careful but at this point in time it certainly looks as if the sellers are in control, and that the buyers are a bit too skittish to get involved at this point in time.