CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

Levels to watch: FTSE 100, DAX and Dow

Indices look set for short-term weakness, yet given the recent bullish signals, this could provide us with a strong buying opportunity.

IG Analyst

Publication date : 2017-09-28T09:27:29+0100

Stock exchange

Source: Bloomberg

FTSE 100 pauses after bullish breakout

The FTSE 100 managed to break higher from a period of consolidation yesterday, with the price pushing through both trendline and horizontal resistance.

We are now seeing the index drift lower, yet given the gains we have seen of late, it looks likely that further upside is around the corner. With that in mind, short-term weakness is seen as a buying opportunity unless the price breaks back below 7271.

FTSE 100 price chart

FTSE 100 price chart

FTSE 100 price chart

DAX looks set for short-term pullback

The DAX has been testing a near-term support level today, which, if broken, would point towards a deeper retracement in the near term. An hourly close below 12,667 would point towards a potential move into Fibonacci support, around 12,637.

However, ultimately, any pullback would be perceived as a buying opportunity, with an hourly close below 12,596 required to negate the uptrend.

DAX price chart

DAX price chart

DAX price chart

Dow turning lower from resistance

The Dow Jones is weakening this morning following a rally into the notable 22,365 resistance level. The 22,323 support level is going to be key in signaling that we are likely to return to the lower bound of the recent price action, around 22,281.

For now, the sideways price action is expected to persist until we get a strong breakout signal. To the upside this would be clear, given the strength of the 22,365 resistance area. However, the somewhat inconsistent lows make a bearish breakout more difficult to spot. For now, consolidation is expected to continue apace.

Dow price chart

Dow price chart

Dow price chart

This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.

Find articles by writer

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. Professional Clients can lose more than they deposit.

The value of shares and ETFs bought through an IG stock trading account can fall as well as rise, which could mean getting back less than you originally put in. Please ensure you fully understand the risks and take care to manage your exposure.

IG does not issue advice, recommendations or opinions in relation to acquiring, holding or disposing of a CFD. IG is not a financial advisor and all services are provided on an execution-only basis. This communication is not an offer or solicitation to enter into a transaction and shall not be construed as such.

IG is a trading name of IG Limited a company registered at 2702 & 2703 Level 27, Tower 2, Al Fattan Currency House, DIFC, Dubai, United Arab Emirates. IG is authorised and regulated by the Dubai Financial Services Authority (DFSA) under reference No. F001780.

The information on this site is not directed at residents of the United States, Belgium or any particular country outside the UAE and is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.