Established in 1974
185,800 clients worldwide
Over 15,000 markets

Levels to watch: FTSE 100, DAX and Dow

US markets continue to outperform, with the Dow hitting new highs yesterday. Meanwhile, both the FTSE 100 and DAX are consolidating within triangle formations.

DAX traders
Source: Bloomberg

FTSE 100 consolidating once more

The FTSE 100 continues to consolidate, with the price currently in a symmetrical triangle formation via the creation of lower highs and higher lows. Ordinarily, that would mean we would be looking for a directional breakout via a move through 7499 or 7537.

However, because this current pattern is taking place within a period of sideways consolidation, there is a good chance we could simply continue to move sideways. Given the recent move below the 7515 support zone, a break lower would have greater implications than a break higher, which would simply point towards a move back into 7553 range resistance.

FTSE 100 chart

DAX pushing higher from triangle bottom

The DAX continues to trade within a symmetrical triangle formation, with the price currently pushing sharply higher following a move back into trendline support. That brings about a strong likeliness of a rally into the descending trendline resistance up ahead.

Ultimately, we are looking for a breakout through either 13,056 or 12,970 to signal where to go next.

DAX chart

Dow continues to outperform

The Dow Jones remains in a clear uptrend, with yesterday seeing the price break higher from the 61.8% retracement. So far, we have not seen a deep pullback.

As such, it makes sense to await either a break through 23,485 or a deeper pullback for bulling entries. We would need to break below 23,264 to negate the current bullish outlook.  

Dow Jones chart

The information 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 Bank S.A. 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 and as such is considered to be a marketing communication.

Find articles by analysts