This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Bulls fail to push FTSE through 200-DMA
We have seen the UK benchmark stuck in a tight range over the past few trading sessions, capped by 6560/70 and a foundation at 6490/6500. A break through the top side would be likely to result in a measured move towards 6525, while any sustained moves back through the 6500 level could see a return to 6420.
The hourly RSI is confirming the short-term trend to the upside, yet with both the 200-hour and 100-hour moving averages above current action, the potential fallout (at least until the US opens) is for sideways moves.
DAX meets overhead resistance from 50-DMA
Price action on the DAX remains resolutely below the 100-DMA and, until we can get a concerted break and daily close through 9370, we can perhaps expect a degree of consolidation with support coming in around 9250/60. Any pullbacks below this support should see buyers at 9190/9200.
Overhead resistance comes from the 50-DMA, currently at 9450. Any moves through this metric would target 9590.
On the intraday, the bullish channel from the 14 March lows is being challenged, yet prices remain above the key moving averages on the H1 chart. The trendline resistance from the 28 February highs is hampering the upside here, and we are entering a narrowing range – with a steady relative strength index – at 50.
DOW’s February support still unbreached
The Dow Jones has found a foundation around 16,296, and the trendline support from early February remains unbreached. The bears managed to push the price back from 16,450 during Friday’s session and we are now capped by the 16,360 level, having been unable to close above this for the past fortnight.
While above the 50-,100- and 200-hour moving averages, the propensity to break higher remains likely, and we could see 16,400 tested in the near term on the break of 16,360.
Any moves back through 16,260 should find rising support from the short-term trendline coming from the 17 March lows of around 16,230. Should that fail then the 16,200 may rescue from the downside.