Levels to watch: FTSE 100, DAX and Dow

The markets are moving into a more bullish phase, with the US leading the way. As the FTSE 100 and DAX approach key resistance levels, we are close to a key breakout signal across the board.

DAX stock market Source: Bloomberg

FTSE 100 continues to push higher after rally through the 76.4% Fibonacci level

The FTSE 100 has rallied through the final Fibonacci level, with the index closing in on the notable 6910 resistance level. A break above there would point towards a continuation of this recent bullish sentiment, negating the wider creation of lower highs.

However, with a descending trendline coming into play around that same resistance level, there is also a good chance that this market will turn lower from that confluence of resistance. As such, watch out for how the FTSE 100 reacts to that area for a signal of where we go from here.

FTSE 100 chart

FTSE 100 chart

DAX heading higher once again

The DAX drifted lower yesterday, following gains throughout the first trading days of 2019. However, with the price having already broken through the 76.4% retracement, it looks increasingly likely that we will push through the key 10,987 mark.

Should that occur, it would be the first higher high in eight months. As such, whether we break through that level will be a key determinant of market direction for the near term.

DAX chart

DAX chart

Dow showing signs of strength after recent declines

The Dow Jones is continuing to gain ground, as it recovers from its recent declines.

The declines associated with the break below 23,112 failed to hold for much time, with the index instead now having exhibited higher highs and higher lows. As such, further upside looks likely, with a fall below 22,587 required to negate the current bullish outlook.

Dow Jones chart

Dow Jones chart


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