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 S&P 500

Indices have begun the week on a sour note, with key support likely to be tested for the FTSE 100.

Chris Beauchamp ChrisB_IG
Chief Market Analyst, London

Publication date : 2017-08-21T09:18:16+0100

Traders

Source: Bloomberg

FTSE 100 holds on to 7300 for now

Despite heavy losses over the past week, FTSE 100 continued to hold the 7300 area, and looks to be doing so again today.

Below this, the 200-day simple moving average (SMA) comes into play at 7268, and from there a bigger unwind to 7100 could be a possibility. Any rally needs to post a close above 7360 to indicate another attempt at breaking the post-June downtrend is underway.

FTSE 100 chart

FTSE 100 chart

FTSE 100 chart

DAX lacking momentum to break the downtrend?

The DAX failed to break the 12,300 level last week, so a retest of the 200-day SMA at 12,000 is now a distinct possibility. From here, 11,900 and then 11,695 come into play.

A close back above 12,300 would indicate that the downtrend from the June high has been broken, but it looks like bulls will have a hard time assembling sufficient momentum for this.

DAX chart

DAX chart

DAX chart

S&P 500 about to test 100-day SMA

The S&P 500 is now looking to test the 100-day SMA at 2418, with a close below this marking a significant development (the last time it opened below the 100-day SMA was 7 November 2016).

Below here we would look to 2400 as a possible area, where buyers may step in, but a daily close below that level opens the way to 2370 and then 2354, the 200-day SMA.

S&P 500 chart

S&P 500 chart

S&P 500 chart

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