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Levels to watch: FTSE, DAX and Dow

Indices show signs of strength ahead of the big BoJ rate decision. With the DAX at key resistance, we could see a sharp increase in volatility in today’s session.

Data screens reflected in trader's glasses
Source: Bloomberg

FTSE choppiness brings mixed outlook

The FTSE has seen a fleeting break below trendline support, with the move below 6724 highlighting potential for this current rally to fall short below yesterday’s high of 6780.

As such, a more hesitant view is in place, with a break through 6780 required to reinstate the bullish outlook.  

FTSE price chart

DAX turns lower from trendline resistance

The DAX has attempted to create a head and shoulders pattern this morning, following a move lower from trendline resistance. Currently we are seeing a rally from that 10,280 neckline, yet an hourly close below 10,280 would point towards a deterioration in the DAX, with 10,264 and 10,196 providing the next interesting support levels.

However, if we see a significant break and closed hourly candle above 10,350 resistance, there could be a bullish extension to this recent rally, with 10,481 the next resistance level of note. 

DAX price chart

Dow continues rebound

The Dow Jones is looking to consolidate the gains seen earlier in the week, with lower highs and lower lows turning into higher highs and higher lows. This is expected to continue, with 18,544 the next level to be taken out for this resurgence to continue.

This bullish short-term view coincides with an equally bullish medium-term outlook, providing greater confidence. We would require a move back below 18,430 to negate this short-term view.

Dow Jones price chart

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