Unless there is a good move upwards this coming week the 9-week cycle in the FTSE indices that we drew yiour attention to last week may not now continue. In the event of lower close in the FTSE indices this coming week there is a greater chance than ever that the recnt rally will have run out of steam. Of course, there is still a chance that this has been but a temporary pause for breath by the market after a 7 week run up the scale but the real risk now is that the indices will move sideways in a consolidation for a few weeks before, perhaps, a two or three week fast fall back.

Our concern and attention continues to be the resistance levels that each of the indices is now testing. The FTSE 250 particularly has, for the second week running, failed to get above the important 8888 level resistance. The FTSE 100 is just a little below its resistance at the 5100 level and the SmCap index has failed for 6 weeks to get above its resistance at the 1415 level area.

In the US the Nasdaq 100 has stalled for many weeks below its resistance at 1630; the Dow is similarly stalled unerneath resistance at 9700 and it is only the S&P 500  that has achieved some progress but then it is only above relatively minor resistance at the 1000 level and is already showing signs that it is tired and likely to fall back below it.

So, we are left with three possible scenarios for the coming weeks; either 1) the markets take heart, increase volumes and push up through resistance levels and give us all more capital growth or                                     2) the weakness in the markets gathers pace, more selling takes place and the indices start what could become a protractred decline or                 3) buying and selling remains roughly equal and so the indices and stock prices neither gain nor lose to any great extent and so meander sideways for a week or two in preparation for a more definitive move, perhaps in October.

As of this weekend, our money is on No.3 as the most likely course.