Levels to watch: FTSE 100, DAX and Dow

Recent record highs across the FTSE 100 and Dow point towards further upside before long. With the DAX falling back, there is a good chance we could see some weakness over the short term, if price breaks near-term support.

FTSE 100 keeps rising within wedge formation

The FTSE 100 continues to create record highs, with the price trending consistently higher since the beginning of December.

The fact that we are seeing a wedge formation points towards a potential breakdown. However, for now we are seeing a clear uptrend in place, and thus a bullish view remains unless we see a break below 7689.

DAX begins to turn lower

The DAX has been selling off since the Tuesday high, with the price hitting a low of 13,224 yesterday.

The ability to break below that level would provide a bearish short-term signal, with the index retracing the 12,742-13,427 rally. Alternatively, should we see a rally through the 13,427 level, it would largely point towards a continuation of the gains we have seen over the past two weeks.

Dow consolidating within reach of record highs

The Dow Jones has moved within close proximity of the 25,440 highs set on Tuesday afternoon.

A break above that level would look towards trendline resistance as the next point of call. As long as the price remains above 25,236, then this consolidation remains a likely precursor to further upside. 

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