Levels to watch: FTSE 100, DAX and Dow

Despite recent gains, tentative bearish signs are coming into play for European and US indices.

Data
Source: Bloomberg

Will FTSE 100 rebound last?

The FTSE 100 rebounded back into the 7623 mark overnight, respecting the 7569 support level. Given the wider 7543-7706 range in place over the past month, there is a chance we could see another move lower to reach that 7543 level.

However, the key to whether we will break higher without reaching that support level is down to whether we see a break above 7623 or not. As such, a push below 7569 would point towards a short-term move into 7543 support, whereas a rally above 7623 would signal a return to a bullish short-term outlook.

DAX looks set for another move lower

The DAX is rolling over again this morning, following a rebound overnight. This looks like a retracement, with further downside likely to bring us into the 61.8% Fibonacci level at 12,308.

A break and hourly close below 12,390 would provide greater confidence of that next move lower for the pair. While further downside looks likely in the near term, this is perceived to be within a wider bullish rebound. As such, the index is expected to turn higher soon enough, with a break below 12,102 required to negate that idea.

Dow wedge could spell trouble

The Dow Jones came under pressure earlier in the week, following on from a strong symmetrical triangle breakout on Friday.

With the index struggling to regain ground lost on Tuesday, we are seeing the index trade within a bearish rising wedge formation. This could spark a stronger move lower, where an hourly close below 24,664 would provide that near-term sell signal. 

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