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

European and US markets have been drifting lower at the start of the week, with questions arising over whether this is a retracement or a reversal.

FTSE 100 drifts lower from Fibonacci resistance

The FTSE 100 has been moving lower after hitting the 76.4% resistance level which capped the price action just over a week ago.The gradual nature of this move points towards a potential retracement in play here, with a break below 6798 required to bring about a wider bearish outlook.

However, while another move lower looks likely over the short term, we need to see a break through the 6983 swing high to point towards a potential rally through that 7000 mark and onwards.

DAX weakening after recent rally

The DAX saw a similar surge into the 76.4% retracement, with the index turning lower in response. The uptrend seen throughout 2019 thus far points towards this current move lower forming a retracement before we move higher once more.

However, the wider bearish trend still holds, with the respect of the 76.4% retracement highlighting the possibility that markets see value in that wider trend. As such, we should watch to see if we can maintain this bearish price action below the 76.4% resistance level, with a break above there pointing towards a potential move into the crucial 11,570 breakout level.

Dow hesitation could provide bullish set-up

The Dow Jones has been drifting lower overnight, coming off the back of a recent rally for the index.

The uptrend remains intact unless we see the price break below 23,726, and thus there could be another leg higher before long. The key to such a move higher would be a rally through the 24,668 resistance level. Until then, there is still a chance for the index to drift lower over the short term.

This information has been prepared by IG, a trading name of IG Markets 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.

See an opportunity to trade?

Go long or short on more than 17,000 markets with IG.

Trade CFDs on our award-winning platform, with low spreads on indices, shares, commodities and more.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. All share prices are delayed by at least 20 minutes. Prices are indicative only.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.