Today we have chosen the UK Long Gilt Chart. We have covered the FTSE a couple of times recently but as it’s the Budget today I thought it appropriate to cover something from this region. After a decent sell off during February we found a base and at the end of that month began to rally spurred on by weakness in Equity markets. The last couple of sessions have seen this trend reversed which is probably some squaring. With potential volatility in the offing it would be wise to earmark wider levels by going through the time frames to longer term charts where 112.03 and 112.44 emerge along with 110.70, 110.36 and 110.14 in the other direction..
Indicators in Play
Time frames. We tend to concentrate on going over longer-term charts during potentially volatile situations like today. It is wise to scan back on weekly or monthly charts when there is a possibility of a big move. Simple old highs, old lows and gaps are typical reference points that tend to work when markets go fast.
On normal trading days, going from daily charts to 60 or 15 minute charts is a very useful way of fine-tuning entry points for a longer view.
Summary
We are still friendly towards the Long Gilt and would be waiting in the wings for a dip buying opportunity to 110.14 should we see enough nerves out there. If we do not get this chance, we would look to raise our bids to 110.36 or even 110.70.
David has been
analyzing and trading the worlds financial markets for the past 25 years. After an initial grounding with Mercury Asset Management and Warburg Securities he went on to set up his own brokerage operation in London. Since then he has appeared regularly on Bloomberg Television and been involved in providing analytics on behalf of some of the worlds major exchanges. He is also a member of the Society of Technical Analysts.
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