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

The week has started with gains, with the end of the month and the quarter potentially providing bullish momentum. 

German Stock Exchange
Source: Bloomberg

FTSE 100 – a new bounce in the making?

Once again the FTSE dipped below 7400, and once again the buyers came out in force to defend the area. Now we see if it can definitively break the descending trendline from the highs earlier in the month. It tried a week ago, and then failed, but perhaps a second time will work out better.

The stubborn refusal to let 7400 go adds force to the idea that a new bounce is in the making. A daily close below 7400 is needed to put a more bearish spin on things. 

FTSE 100 chart

DAX another run at the 12,881 – 12,950 area is likely

The daily chart continues to show the ongoing consolidation for the DAX, but the series of higher lows witnessed over the past month or so still points towards bullish momentum.

Now the index looks to be making another run at the 12,881 – 12,950 area, where it has run out of steam since the end of May. Bears would need to break the rising trend of higher lows, which would suggest a close below 12,605 is needed to raise the prospect of a longer-term decline.

DAX chart

S&P 500 a close below the latter would be a sign of weakness

Bulls have had a hard time breaking out of the 2450 zone but it looks to be making another run at it. Over the past two weeks, 2430 and then 2420 provided good support in the S&P 500.

We would need to see a close below the latter to suggest more weakness is likely.

S&P 500 chart

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