FTSE 100, DAX and Dow gains bring potential bullish phase
FTSE 100, DAX and Dow gains point towards a potential impending period of upside for stocks.
FTSE 100 decline takes us towards consolidation support
The FTSE 100 failed to overcome the 6324 level yesterday, with the index remaining within the consolidation zone of 6219-6324.
The break from that zone will tell us a lot about where we go from here. With that in mind, it makes sense to either play the consolidation (longs near 6219), or await the breakout to solidify the short-term directional bias.
DAX pullback unlikely to last
The weakness seen in the DAX overnight looks likely to be a short-term pause in the wider bullish trend, with long positions favoured unless we see the 12,807 level broken.
With that in mind, short-term downside could actually provide a better buying opportunity, with Fibonacci support around 13,001 and 12,927 providing favoured areas to look for a potential upward swing.
Dow Jones starts to weaken from Fibonacci resistance
Yesterday saw the Dow briefly fall below the short-term support level of 26,837, highlighting the potential for a bearish phase to come into play. That came off the back of a rally into the 76.4% Fibonacci level, where the respect of that level highlights the potential for us to move lower over the short term.
With the stochastic breaking below the 80 threshold, we could see weakness for now. However, that could simply provide another higher low, above the 26,441 low from Monday. To the upside, we would need a break through 27,028 to start building another more bullish short-term picture for the index.
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