Levels to watch: FTSE, DAX and Dow

Greek bailout signoff brings further bullish sentiment to already buoyant markets.

Data on a board
Source: Bloomberg

FTSE sells from resistance, yet likely to return

The FTSE 100 sold off yesterday following a break to the key resistance level of 6809 (7 May swing low). Given the recent recovery, I expect to see us challenge that level again in the near future as long as the price remains above the 6727 support level. A move above 6809 would likely move us towards the next resistance level of 6871. However, a move below 6727 would bring a likely move to 6692 and 6672. For the time being I remain bullish and expect a new high to be created as long as the price holds up above 6727.

DAX breakout continues to gather pace

The descending channel breakout we saw on Monday has pushed the DAX into a more bullish mindset, especially given that we saw the retest of previous resistance the following day. As such, we are simply seeing a clear stepped trend with each short-term period of consolidation leading to another step higher. I expect today to thus see another step higher and will await the next pullback for another entry point.

Dow continues to create new July highs

The Dow Jones continues to climb despite moderately hawkish comments from Janet Yellen yesterday. The clear bottoming out of this index has paved the way for a very strong recovery, and I expect this to continue. Much like the DAX, it is simply a case of waiting for a good entry, and thus consolidation will often show where the key support level is for the next move higher. I have been watching the 18,112 level in the past and so far this has been providing support. However, I would watch for further consolidation to find a good long entry price. My bullish outlook comes into question should the price move below 18,008.

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