Key index levels: technicals for FTSE, DAX and Dow

The move through 6680 has pushed the FTSE to levels not seen since early March. 

FTSE slightly overbought

From here we should see the FTSE 100 target 6735 in the intraday, as the daily relative strength index still looks like it has momentum. Support will then be provided by 6700 and then 6680.

The index is slightly overbought on the shorter-term charts, and rising trendline support from the 4 April lows may see a test before pushing higher.

A daily close through 6735 puts us on a trajectory towards 6770.

German Ifo boosts DAX

A decent German Ifo beat has put legs under EUR/USD and indeed the DAX this morning, and price action remains supported by the 50-hour moving average. A move through 9630 would put us on a move towards 9697. The H4 RSI is displaying a degree of bearish divergence right now, so we may see a pullback towards 9560 before any additional move up.

Any declines back through 9540 will target the 9475 level.

Dow approaches all-time highs

The usual concerns arise as we approach the all-time highs on the Dow Jones. A push through 16,650 would be very bullish and, as per yesterday’s note, will put 17,000 or indeed just below that metric in sight.

Consolidating below 16,570 for now we may be looking at a range-bound trade with 16,480 coming in as support, with the H4 and HI1 chart also showing a little negative divergence. Yet we are seeing a bullish crossover of the 50- and 200-MA on the H4 timeframe.

The 50-hour MA is still working for the buy-on-the-dips strategy – any falls below 16,480 might confirm a double top formation in the short term, which could see a drop back to 16,400.

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