Technical indicator hits 15-year high: Is this a FTSE sell signal?

An indicator that measures momentum in the FTSE 100 index has shot up to levels last seen in 1997, implying the UK's leading share index is at its most overbought level for 15 years.

The Relative Strength Index (RSI), used to measure momentum in the FTSE 100, moved well above its 50-day moving average yesterday, after the FTSE gained 67 points to close at 6,265. This took the reading - which works on a scale between 0-100 - to a multi-year peak of 79.85, its highest level since 1997. Bill McNamara, technical analyst at Charles Stanley, said the move higher had left the FTSE 100 vulnerable to a pull-back. "The FTSE is looking very stretched," McNamara said. Another technical indicator McNamara said is also pointing to a pull-back in equities is the FTSE 100 V...