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

Friday’s turmoil has given way to a period of calm, and while markets have a lot of work to recover lost ground, there are signs of some stabilisation in markets.

US trader watching data screens
Source: Bloomberg

FTSE 100
The recovery above 6000 which took place on Friday is intact this morning, as yet another dip sees a combination of bargain hunting and short covering. The 6100 level marks another line in the sand, with a move above here still potentially targeting 6300.

Any drop below 5900 appears to be the ‘make or break’ zone for the index at present. Of course, any sudden news on Brexit could render these key levels irrelevant very quickly, so caution is called for. 

Remarkably, 9440 continues to hold, with this vital level still refusing to give way.

As a result, price action might suggest the next move to the upside would be around 10,000, and then back towards 10,400.

A close below 9440 still takes the index back down towards the lows of February, around 8700. 

S&P 500
The daily chart for this index looks the least encouraging for bulls. The 2040 area, which was so key as support in May, was lost on Friday, so any rally needs to get back above here and quickly. Otherwise the next area to watch would be the 2000 zone.

Any move back above 2040 would then put the index back within its general range, with a move back to 2100, while a close below 2000 risks a move in the direction of 1950. 

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