Levels to watch: FTSE, DAX and Dow

Global markets continue to crash lower, building on the rout seen last week.

A man walking by a data board
Source: Bloomberg

FTSE losses continue to take out crucial support levels

The FTSE has continued to plummet, with today’s price action moving below both the December low of 6123 and October low of 6070. It is difficult to gauge exactly when this rout will stop, and it takes a brave person to go long in such conditions. Thus I see it worthwhile to watch intraday charts, and the current upside seen on the hourly chart points towards a recovery for the time being.

Given the trend, I would be looking for the sellers to come back into play soon. The 6070 and 6123 areas have now turned into key resistance levels from previous support, and thus I am bearish as long as the price remains below 6123, with reversal signals such as a bearish engulfing possibly around the 6070-6123 region expected to resume downside.

DAX spinning top leads to period of upside

DAX has posted a spinning top candle this morning and is seeing a period of upside as a result. This morning star reversal points to possible upside, yet the break out of the bottom of the descending channel dating back to March is highly bearish and points towards a clear upside resistance level. That resistance level coincides with the support level from late last week at 10,060. Thus I expect any upside to meet resistance around 10,000-10,060. Again, I will be watching for any bearish reversal signs. 

Dow selloff expected to continue

The selloff in the Dow Jones has gained some brief respite this morning, yet given the trend in place, it is clear that further losses could be in sight. A very similar story to the DAX and FTSE, where I am watching for a bearish reversal sign from the current flag formation. The safest of which would be a move below the 16,000 low. The first major support level in sight would come in around 15,848 (October low).

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