Levels to watch: FTSE, DAX and Dow

Bulls have lost control early on today, as indices fall back across the board. 

A man looking at data
Source: Bloomberg

FTSE starts September with bearish outlook

The new month has started off on a poor note for the index, as it concedes the 6200 level to the bears and threatens to undo much of the good work of last week. If we have seen a topping out then the downside towards 6076 comes into play, followed on by the lows of last week all the way down towards 5800.

The FTSE 100 now finds itself moving back below the 50-hour SMA (6194), with a target in the direction of 5900 on the hourly chart. We would need to see a confirmed move back above 6200 to invalidate the bearish outlook.

FTSE 100 chart

DAX recovery ends as it slips below 200-SMA

It looks like the nascent recovery of last week has run its course here too. The price has slowly slipped below the 50-, 100- and 200-hour SMAs (10,206, 10,205 and 10,148), and now looks set to challenge the lows of last week towards 9600. The trend appears to have shifted to the downside once again. Any recovery needs to push back above 10,400, where gains petered out last week. If the index closes lower today then daily stochastics will begin to roll over, setting up fresh downside. 

DAX chart

Dow downside dominates

US markets were weak yesterday, and futures have continued this overnight. With the price back below the gap down from last Monday, the downside now seems to prevail. Downside targets lie around 15,800, then on towards 15,600. The Dow Jones would need a move back through 16,600 to cancel out this scenario, which perhaps illustrates how strong bearish momentum is at present.  

Dow Jones chart

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