Levels to watch: FTSE, DAX and Dow

Recent losses for the indices resulted in what looks like pullbacks for the FTSE, DAX and Dow. This could provide us with bullish reversal opportunities.

Wall Street
Source: Bloomberg

FTSE higher following yesterday’s sell-off

The FTSE is punching higher today, in the wake of yesterday’s sharp move lower. Crucially, we saw the price tumble back into the vital swing low of 7357 before pushing higher from the brink. We still have a lot of room to regain, and thus further upside seems likely from here.

Given we are now faced with flat-lining lows rather than higher lows, it throws a question mark on whether it will have enough strength to break through the 7516 mark. However, until we break back below 7357, there is a good chance we will see the bulls remain in charge to continue the resurgence we have seen so far this month.

FTSE chart

DAX turning higher from 76.4% retracement

The DAX pulled back into the 76.4% retracement yesterday, bringing a bullish opportunity. As the wider uptrend remains intact, a bullish outlook is in play here. A break below 11,942 would be required to negate this view.

Watch out for an hourly close above 12,256 to spark near-term strength given the intraday inverse head and shoulders pattern it would complete. Also keep an eye on the symmetrical triangle seen on the stochastic oscillator. A break higher from there could spark a surge in the price action. 

DAX chart

Dow expected to turn higher following pullback

The Dow Jones has moved into the 76.4% retracement twice in the last two trading days, with the 100-period simple moving average (SMA) also providing reliable support.

With that in mind, any move into the 21,515 level would look particularly attractive for longs. We would need to see a break through 21,466 to negate that bullish short-term bias.

Dow Jones chart

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