Key index levels: technicals for FTSE, DAX, Dow

The mining sector contingent of the FTSE has ensured, both recently and over the past 15-months, that the UK benchmark underperforms its European counterparts.

FTSE on the back foot

The failure to sustain a move and a daily close through the 6641 level (per yesterday’s analysis) has left the FTSE on the back foot, with both the 6620 and 6600 levels failing to act as reasonable support. A break out to the top side which fails to maintain momentum can be construed as rather bearish; a false breakout if you will.

The confluence of the 200- and 100-period moving averages at 6566 are supporting the intraday, so a rise through the 6600 level is sorely needed if we are to escape the current tight range.

Any fall through 6560 will target the 6540 level, then we should see rising trendline support coming from the June 2012 lows around 6520. 

DAX fails to break 9500

The DAX made a brave attempt to break the 9500 mark yesterday but to no avail, likely due to some early profit-taking as short-term charts registered overbought signals on the relative strength index.

Price action remains above the 50-day moving average and as long as 9430 holds, we may soon see a retest of the round number. Should the 50-DMA succumb to the bears, then the 100-DMA at 9380 will become the next initial target. A daily close above 9500 brings the 9580 level into focus.

Dow has bias to the downside

Despite numerous intraday highs for the Dow Jones since the beginning of the year, we have yet to witness a daily close above 16,470; yesterday’s bearish candle practically engulfs the previous day’s action. Depending on where we end today’s session, there is a bias to the downside on the basis of the above observations. We have also seen the price now fall below 16,300-10, a key level over the past week.

The uptrend from the February lows remains in vogue with rising support, coming in around 16,200-20, helped by the 200-period MA on the four-hour chart.

A failure to move through 16,300 today would bring the 16,249 region then the 16,200 level into focus. 

IGA, may distribute information/research produced by its respective foreign marketing partners within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

This information/research prepared by IGA or IGA Group is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. 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. In addition to the disclaimer above, the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.

See important Research Disclaimer.