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

Good data from the US and positive noises about stimulus in Japan continue to lift equities, with new all-time highs in US markets likely this afternoon.

Data charts
Source: Bloomberg

FTSE 100

​The index is pushing above 6600 this morning, after Friday’s session took it to the top of the recent 100-point range. A close above 6600 hands the initiative to the bulls, taking the index on to 6715 and then 6800.

For the time being, the post-Brexit breakout above the April 2015 downtrend line is intact, so we should expect dips to be bought. It would need a close below 6400 to really change the outlook here.

FTSE 100 price chart

DAX

The DAX is back at 9800, which is where gains faltered at the end of June/beginning of July. A close above here opens the way to the 10,300 area, where the rallies of late May and mid-June faltered, and then above here the index faces a test of its 2015 downtrend.

A failure to push higher over the coming sessions might suggest a return to the 9300 low of last week, with the late June low of 9200 just below this.

DAX price chart

S&P 500

Friday’s breakout and early gains for US futures have put the index at a new all-time high (excluding dividends). Thus, with the index still not overbought on a daily timeframe we should continue to look for dips to be bought.

A close back below 2130 might signal short-term weakness, but for now the advantage lies with the buyers. 

S&P 500 price chart

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