FTSE 100, DAX and Dow likely to head lower yet again

FTSE 100, DAX and Dow expected to decline yet again, with overnight consolidation unlikely to last.

FTSE 100 looks primed for another leg lower

The FTSE 100 saw another bout of sharp declines yesterday, with the index falling back into levels not seen in over a year. Given that much of the downside seen yesterday was a response to growing coronavirus cases in Europe, it is likely that those announcements will increase in the daytime, and ease off overnight.

With that in mind, further announcements look likely, with losses expected to persist for stocks. The overnight consolidation looks like the setup seen yesterday, with the price expected to break lower before long. Watch for a decline below the 6911 low to signal the beginning of that next bearish move, with shorts expected to hold dominance as we continue to see the coronavirus spread throughout the western world. A break through the 7201 level would be required to negate this bearish outlook.

DAX sell-off pauses, yet bearish picture remains

The DAX has similarly been consolidating overnight, coming off the back of a big decline yesterday.

This looks to be a setup that is consistent with yesterday’s price action, with a breakdown below 12,611 providing us with another sell signal for the DAX. Only a break through 13,162 would bring about a bullish outlook for this index.

Dow Jones expected to slump once again

The Dow Jones consolidation seen overnight highlights the very similar picture seen across all three markets.

With that in mind, a break below 26,997 points towards the beginning of another breakdown, as we continue to see market fear express itself in stock market weakness. A break through 28,249 would be required to negate this bearish outlook.


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