Levels to watch: FTSE, DAX and S&P 500

The rebound in tech stocks is lifting the S&P 500, while eurozone markets continue to build on their gains from earlier in the week.

German Stock Exchange
Source: Bloomberg

FTSE 100 in danger of dropping back to 7400

With the pound continuing to strengthen against the US dollar, it has been hard for the FTSE to sustain the election night bounce. Indeed, having failed to break back above April rising trendline, it now looks in danger of dropping back to 7400 or lower.

However, sellers will need to break through the 7480 area that has acted as support since Friday. This would pave the way for a more bearish move. Buyers will want to clear 7560, which would leave us within easy distance of the 2 June all-time high.

FTSE chart

DAX at the end of consolidation mode?

It looks increasingly like eurozone markets will be pushing higher after a long consolidation period. The DAX has spent the past six weeks hovering just below 12,900, with sellers unable to hold the market down near 12,500 or lower.

Now the price has recovered and is within 80 points of the previous high. A breakout above here puts us back in all-time high territory. We are still in consolidation mode but this seems to be ending. Only a close below 12,500 would suggest a bigger bearish move is at hand.

DAX chart

S&P 500 - backing to new all-time highs?

A steady recovery off the lows of the week leaves the S&P 500 with only 2442 (yesterday’s high) and then 2446 as the upside targets.

Beyond this, it's back to new all-time highs. Sellers will continue to be frustrated until we see a close below 2400. 

S&P 500 chart

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