Levels to watch: FTSE, DAX and Dow

Indices remain under pressure this morning, with nervous eyes cast at the fall in oil prices.

Source: Bloomberg

FTSE 100 RSI holds firm

Yesterday was spent pushing the index lower from the Friday highs, which coincides nicely with the top end of the current descending channel.

If the index continues to hold below 6051 then the outlook would seem to shift towards bearish – targeting 5981 and then down towards 5851 in the event of a bigger move.

The rising hourly trendline still holds for now, and dip buyers might decide to try another entry just above 6000 in case sentiment revives, but it is beginning to look like the bounce has run its course.

A definitive move back above 6100 would negate this outlook.


DAX sellers in charge

The DAX never really joined in the broader rally, which is odd given it was the European Central Bank that kicked off the revival in risk assets.

Having lost the hourly trendline last week, momentum has continued to shift to the downside.

A clear break of 9600 would be the real signal that we are off to the downside, but unless the index gets back above 9900, where the rally (of sorts) stalled last week, it seems like the sellers are in charge. 


Dow eyes 16,700

US markets look in better health than those on the continent, but with oil in retreat the rally is starting to look shaky.

If the Dow Jones pushes back below 16,274 then we may be in for more substantial downside, at least as far as the rising hourly trendline, which comes into play around 16,100.

Any bounce back above 16,500 suggests that the index is headed towards 16,700 and higher, although much of that will depend on what oil does. 


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