FTSE falls below 6600
Continuing with the tradition of round numbers as potential support, a drop through 6500 would put us back to the 6400 zone, which saw buyers in December and late January. The daily relative strength index is still oversold, while the stochastic index is now at levels not seen since mid-March.
For the embattled index, a close back above 6600-6620 is the only way a turnaround can begin, but there seems little sign of that yet.
DAX RSI becoming oversold
The DAX is trading below the 8950 low of March, and now we look towards the 8755 zone from September. It is hard not to think that some sort of bounce is due, with the daily RSI becoming more oversold while other momentum indicators hit multi-year lows (MACD, for example, is at a level not seen since 2011, when it continued to go much lower).
The 9000 level now becomes resistance on the upside, and only a close above here would suggest that there is some kind of rally underway. But it is August, and so the downside scenario takes precedence.
Dow below 200-DMA
Not since the beginning of February has the Dow Jones been below its 200-day moving average, and while the 16,230 area might provide some support all eyes are now on 16,000.
Dow 17,000 is a distant memory, but even now the index is not yet 5% down from its highs. If a correction is underway, we still have plenty of distance to cover.
The 200-DMA becomes important now, as it will likely act as resistance on the upside. A close back above here would be welcome for the bulls, but that seems an unlikely prospect today.