Levels to watch: FTSE 100, DAX and S&P 500

The indices remain in their overall bullish trends, but some weakness is evident for now in the FTSE 100.

FTSE 100 Index S&P 500 Index Standard & Poor's DAX

FTSE 100 in short-term bearish formation

The FTSE 100 fell to a four-day low yesterday, and while it continues to hold the 7160 area, it now needs to break above 7220 to clear the descending triangle formation that is potentially in play.

The next short-term levels to watch are 7240 and 7260. A move below 7160 would suggest that a broader retracement towards 7050 is in the offing.

DAX prepares to challenge trendline resistance

The bounce from the lows around 10,900 is intact, but over the past few sessions the DAX has run into resistance around 11,350.

The 11,350-11,400 zone stifled progress in early February, so any break higher is dependent on the removal of this obstacle. Around 11,400, the index will also encounter trendline resistance from the June high. This trendline has not been tested since the end of September, so a break above this would be a significant development. Further short-term weakness below 11,240 would target 11,040 and then 10,850.

S&P 500 still in bullish form

The return of US markets from their holiday did not see any significant downside for the S&P 500, with small gains being the order of the day.

The uptrend remains intact, and a drop below 2760 would suggest a move back towards 2730 support.


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