Levels to watch: FTSE 100, DAX and Dow

European and US indices are consolidating, with a rising chance that there will be a bullish breakout starting to build.

FTSE 100 consolidates within triangle formation

The FTSE 100 has been trading within a triangle formation since declining sharply throughout last week.

With the price approaching the apex of this pattern, there is a strong chance we will see a breakout today. As such, watch for a break through either 7075 or 6954 as a signal of where we go from here.

DAX approaching crucial bullish breakout level

The DAX has started to regain ground, with the price approaching a crucial double bottom neckline of 11,711.

Should we post an hourly close above that level, it would point towards a bullish phase coming into play following recent losses. As such, look out for such a break as a signal of a reversal. Until then, continued consolidation looks like a distinct possibility.

Dow finding support on ascending trendline

The Dow Jones has moved back into trendline support in a clear phase of consolidation since tumbling lower last week. The ability to remain above trendline support will be key in determining whether we are going to push upwards from here.

As such, much like the FTSE triangle, the ability to push through the first swing high (25,545) will be key in signaling an impending upward move for the Dow. To the downside, watch out for a break below the previous low of 24,896 as a precursor to another leg lower.

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