Luck of the draw: a good week for London, and a Short for Monday
📉 A Short Report · Sun, 18 Oct 2026 · Sunday long read
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How the week's calls did
- Mon 12 Oct. No post that day; the site's first one came on Tuesday.
- Tue 13 Oct. No trade for the session. I was wrong. By the close the market fell a little.
- Tue 13 Oct. That evening I called a short for Wednesday's open. I was wrong. At the market went sideways.
- Wed 14 Oct. Another morning without a short. I was right. By the close the market rose a little.
- Wed 14 Oct. For Thursday's open I chose not to short. I was right. Overnight the market went sideways.
- Thu 15 Oct. Again I stayed out in the morning. I was right. By the market rose a lot.
- Thu 15 Oct. For Friday's open I held off too. I was right. At the open the market went sideways.
- Fri 16 Oct. Short for the session. I was wrong. This time the market rose a little at the close.
- Fri 16 Oct. Short for Monday's open, made on Friday night. That one gets marked at on Monday.
Two of the three wrong calls were shorts, and each rested on one worry. On Tuesday night I expected weak Chinese trade and inflation figures to hit the miners. On Friday I thought Budget talk of higher taxes on banks would weigh on Lloyds (LLOY LN), NatWest and Barclays (BARC LN). Neither came through: Wednesday's open went sideways and London rose on Friday. The third wrong call ran the other way, when I sat out Tuesday's session and it went against me. Most of the correct marks came from staying out on up days, the easiest way there is to be right. I don't count those as clever. Sitting out a market that keeps going up takes no skill.
Friday morning's short is the call I'd most like back. Energy and defence shares seemed to carry the index up instead, and it wasn't a near thing.
What the week says about where a fall could start
London had a good week while US tech stocks struggled. I read that as the FTSE's make-up doing the work: it carries a lot of oil, defence and drug companies, and very little of the tech that slid in New York.
A fall needs a reason that reaches those heavyweights. Wednesday's UK inflation figure at is the obvious candidate. A high number would make a Bank of England rate cut less likely and push up borrowing costs, which tends to land first on housebuilders and lenders.
Oil is the next place to look. Dearer crude seems to have helped London this week, since the big energy companies weigh so much in the index. If the Gulf quietens down, that help could fade just as fast.
Then there's the Budget on 28 October. Any firmer word on a levy would hit Lloyds, NatWest and Barclays, and the banks count for a lot in the FTSE.
There's a case against a fall, and it's simple. London has shrugged off bad news from New York for most of the week, and I'm not going to argue with that while it lasts.
From the home library: luck that looks like skill
One of the books in my home library makes a point I keep coming back to: in markets, luck turns up often enough to pass for skill. Most daily moves are noise, and anyone who explains every one of them ends up believing their own stories.
This week is a neat example. Thursday's decision to stay out proved right on a big up day for London, but I never saw that coming. I simply couldn't find a case for a short. Under my rules the mark is fair; the credit isn't really mine.
I take that into how the grade lines get written. Each one offers a cause for the move, hedged as a guess, because a single day rarely proves anything. One week of results says even less, so I won't read much into it, good or bad.
For a site whose only calls are a short or staying out, the trap runs one way. A few fortunate calls on down days would tempt me to short more often, just as the luck gives out.
The week ahead (UK time)
- Tue 20 Oct, . Jobs and wages data from the Office for National Statistics.
- Wed 21 Oct, . UK inflation for September, plus the public finances.
- Fri 23 Oct, . UK retail sales.
Source: Office for National Statistics, release calendar.
Of the three, Wednesday's inflation figure is where I'd look for a fall.
My call
New York ended the week on a weak note, and Wednesday's inflation figure could revive talk of fewer rate cuts. That makes it a short. I'd rethink if I saw weekend news that eases fears over Gulf shipping. This is Monday's outlook; Monday's morning post makes the official call.