Levels to watch: FTSE, DAX and S&P 500

After a strong run last week, indices are weaker this morning, with a combination of a rising euro, falling oil prices and profit-taking sending markets lower.

DAX logo
Source: Bloomberg

FTSE 100 may have more weakness in store

Having failed to push on above 6850 last week, the index has this morning tested the rising hourly uptrend that has held since its low at the beginning of November. We now look to see if it holds below 6800, and then pushes on below 6700.

This might then suggest a move to the 200-day simple moving average (SMA) at 6525. If the price fails to move back to 6850 then it looks like more weakness is in store.

DAX downside looks likely

Euro strength is adding to the worries faced by eurozone markets this morning, as a general risk-off attitude takes hold. The index is now back at 10,600, where buyers have stepped in since the US election.

A drop through here might see the 10,500 area tested, or even down to 10,200. Certainly momentum indicators have been heading lower over the past few days, which would strengthen the idea that more downside is on the way.

S&P 500 progress stalls

The index has fallen below the rising ceiling that has stalled progress before, back in mid-2015. A failure to push back above 2215 would suggest we are due a retracement for the time being.

A bigger drop could see the price head back to 2161, the 100-day SMA, and then below this we look to 2120 and the rising 2016 trendline. 

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