This week produced some fine UK 100 examples of easy-to-identify technical signals to help clients either take profits following a positive run or buy into a bounce on fresh bullishness. From Banks to Housebuilders, support lines to resistance, reversals to breakouts and candlestick patterns the signs were plentiful for anyone prepared to scout around a bit, or allow us assist you.

Banking behemoth HSBC made a bearish about turn after a three-day 3% rally. This was no surprise with 772p having served as resistance between Nov 2009 and Oct. Remember the more times it serves as resistance (or support) the more chance it does so again. Big gaps higher this week, culminating in a long upper tailed candlestick on Wednesday suggested fatigue, and was duly followed by a near full 3% retrace to please the bears. Bulls are now looking for the shares to bottom out and deliver another 3% rebound from 745p that they can piggy back.

UK property developer Berkeley Group offered an excellent opportunity to take profits after a near 14% rally from mid-November. Having closed sharply higher last Friday, the shares hovered around 4100p this week, consolidating. Still toying with the ceiling of a 12-month bullish rising channel, they are either set for a 10% retrace to the channel floor at 3700p or pausing before a breakout above 4200p. The channel suggests a greater probability of the latter, but the November uptrend remains intact. And confirmation is required first.

Away from trendlines, and over to candlesticks patterns, and another easy fatigue spot was temporary equipment supplier Ashtead gapping up to fresh all time highs only to open the next day sharply lower at 2-day lows. A classic evening star/island reversal signal suggesting a top, which has since offered 5% downside for the bears. Much like Whitbread continuing its own bearish reversal from 1050p resistance last week, now down a whole 5% in a week. Annualise that!

In terms of a decent breakout, ITV finally broke above 162.5p, having been stuck below since early November. However, simply getting above the trendline wasn’t the only sign of a bullish reversal. It also completed an inverse Head & Shoulders pattern, which it is assumed will result in an up-move equating to the depth of the recent trough (162.5p to 145p = 17.5p), means upside to 180p. Which happens to equate to Oct highs. You say coincidence, I say technical analysis. Like the simple bounce for St James Place off September rising support. So far up 2.7%, it could yet do double (actually a trade idea of ours this week).

With all this in mind, what are we looking at next week? How about British Land at multi-month highs after a 13% rally, facing a 2.5yr trendline of resistance. We’ll be looking to trade either the breakout or retrace (14% upside or downside), thanks to CFDs allowing us to trade both long and short to capitalise on movement in either direction. We will also look for which way Berkeley Group breaks (see above) and whether Whitbread gives any hint that the recent pullback might be a bullish flag pattern that takes us back to last summer highs of 4400p (+15%).

These are  a handful of examples of the type of analysis you can expect just from our Another Level publications, which clients receive daily. Fancy receiving a copy to help you identify profitable trading opportunities? Just sign up here and join our thousands of happy readers. In fact, as a trading client you can even request bespoke charting annotations from us here in research. Want to know how we see a particular chart? Ask your trader, he’ll forward the request, and you’ll get a prompt response with our easy to read observations, helping you make an investment/trading decision. We’re here to help. Use us!

If you’re still out Christmas shopping this weekend, the very best of luck to you. If not, congratulations, and enjoy a rest before the last full week of market moving fun and games before 2018.

Mike van Dulken, Head of Research, 15 Dec 2017