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Levels to watch: FTSE, DAX and Dow

Mario Draghi’s hints of more easing has produced a bullish move in equities, especially in the DAX, while good numbers from Amazon, Google and Microsoft meant that the US ended the session yesterday in good form too.

Data
Source: Bloomberg

FTSE 100 eyes 6682

The FTSE enjoyed a decent session yesterday thanks mainly to Mario Draghi, and while the official close didn’t end up above 6400, the index did move above this level overnight.

If it can hold above that level today then the possibility exists for a move higher, although the area around 6430–6450 will need to be breached.

However, with other indices pushing higher it is likely the FTSE will be dragged upwards too. Further upside targets lie around 6597 and then on towards 6682. 

FTSE 100 chart

DAX hourly RSI declining

Not since 20 August has the DAX been through the 10,600 level. This breakout alone marks a significant departure from the range we saw in August and September (and for most of October as well).

The next stop will be 10,798 and then on to 10,960. The hourly RSI has been declining, which may act as a short-term warning that a pullback is likely to transpire, in which case we look towards support at 10,487. 

DAX chart

Dow could find support at 17,265

A combination of Mr Draghi and good results from big name tech firms enabled the Dow Jones to push through its range for the week, taking it right back to the 200-day SMA (17,576) and the downtrend line off the May highs.

More gains from here would see the index on course to challenge 18,144 and then the all-time highs, with 17,856 as resistance on the way.

It would be disappointing to see the index drop back again after such a big move yesterday, but in that case we look for support around 17,265. 

Dow Jones chart

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