Shire plc - Daily Candle Chart 9th March 2009

Shire plc - Daily Candle Chart 9th March 2009

My suggestion for tomorrow’s spread bet is on the London markets and is Shire PLC, which closed this evening on the cash market at 798.50p per share, and I am suggesting that this is a buying opportunity for the short term. First, following this evening’s close we have a long legged doji, an excellent signal that the market is indecisive and could be ready to reverse from the current downwards trend, and whilst the bulls have not overpowered the bears, the candle suggest that a turn is possible. The second point to note is that the spreads of the down bars are narrowing, suggesting that the momentum of the downwards move is reducing, and combined with this we can see that the volume of the last three down bars is also falling, which again is an excellent signal that the selling pressure is coming to an end. Finally we note the large volume on the day under the doji candle, suggesting that buying or stopping volume has now entered the market. Using volume spread analysis combined with our candlestick analysis, this suggests that we could see a rise in Shire plc prices in the next few days from the current price of 798.50p. I would suggest placing a stop loss somewhere below 760p.

Spread Betting Tip - FTSE 100 Index