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FTSE meanders around 6830
A daily close above the 6830 level is necessary if we are to make any moves higher, and given the action of the past few trading sessions, we may simply meander around this level. A break through the 8 May highs could set the scene for an attack of the February high around 6886.
An overbought signal and negative divergence on the daily relative strength index could mean the FTSE will remain rangebound with a bias to the down side, especially of we pull back below the 6800 metric. The 200-hour moving average resides around here and has supported the upside well since mid-April.
Below this lies 6770-5, then 6721.
DAX hindered by resistance
The trading channel from the 14 March lows remains in vogue with rising support around 9450, with 9400 likely to rescue should this trend support fail.
Caught in a trading range with that support around 9400 since April 17, the DAX still remains constrained by the 9640-5 resistance level. Price action hasn’t managed to move above here since early April, staging a retreat on every test.
Any breach through resistance should target the 4 April highs around 9720.
Dow could see profit-taking
The Dow Jones notched yet another record high last Friday, so it remains to be seen whether Ukraine tensions will see caution prevail today in the form of profit-taking.
Interesting to watch are the small-cap stocks which are beginning to look a little softer of late. This could be a precursor to a significant move in the blue chip indices.
A move through the 16,650 level along with a daily close above this would tend to indicate the bulls are in charge. Clearly we would like to see the index establish a good foothold above 16,600 first.
Short-term support is found at 16,570, with the confluence of the main moving averages all conspiring to keep price action above the 16,500-10 level.
Main support comes in at 16,350 where bids have been found since mid-April.