CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Please ensure you fully understand the risks involved. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Please ensure you fully understand the risks involved.

Levels to watch: FTSE 100, DAX and Dow

Selling in UK and European indices has subsided for now, with the DAX showing particular strength.

Chris Beauchamp ChrisB_IG
Chief Market Analyst, London

Publication date : 2017-11-16T09:42:32+0000

German stock exchange

Source: Bloomberg

FTSE 100’s overnight bounce fades

The bulls will be relieved to see FTSE 100 hold 7360, but the overnight bounce has seen some selling. However, with breadth recovering after days of declines, we may see the index slowly recover likewise.

A move above 7409 is the first step, and then on to 7427. A loss of 7360 would suggest that the 7294, and then 7260 areas, are going to be tested.

FTSE 100 price chart

FTSE 100 price chart

FTSE 100 price chart

DAX surges back above key support

Wednesday saw DAX take a dip below the 50-day simple moving average (SMA) of 12,936, and even below the vital 12,954 support level. However, the buyers have stepped in, and we are seeing further strength this morning that could see the 13,095 area tested in short order.

If this is taken out, then the rally is arguably back on, with intraday dips providing fresh buying opportunities. The picture changes if we see a close below 12,954, with this potentially bringing a test of 12,678 into play if the index falls below the 12,844 low from yesterday.

DAX price chart

DAX price chart

DAX price chart

Dow steadies but remains in downtrend

US markets have drifted lower, rather than suffering the outright selling seen in the UK and Europe. However, we can see the pattern of intraday rallies being firmly sold, so the Dow Jones needs to clear 23,416 as a first step, to avoid creating a new lower high.

Above this, the 23,468 highs from the beginning of the week are in play. A close back below 23,232, the lows from yesterday’s session, would open the way to more downside, to 23,174 and then 23,003.

Dow Jones price chart

Dow Jones price chart

Dow Jones price chart

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