Levels to watch: FTSE, DAX and Dow

Global markets continue to crash lower, building on the rout seen last week.

A man walking by a data board
Source: Bloomberg

FTSE losses continue to take out crucial support levels

The FTSE has continued to plummet, with today’s price action moving below both the December low of 6123 and October low of 6070. It is difficult to gauge exactly when this rout will stop, and it takes a brave person to go long in such conditions. Thus I see it worthwhile to watch intraday charts, and the current upside seen on the hourly chart points towards a recovery for the time being.

Given the trend, I would be looking for the sellers to come back into play soon. The 6070 and 6123 areas have now turned into key resistance levels from previous support, and thus I am bearish as long as the price remains below 6123, with reversal signals such as a bearish engulfing possibly around the 6070-6123 region expected to resume downside.

DAX spinning top leads to period of upside

DAX has posted a spinning top candle this morning and is seeing a period of upside as a result. This morning star reversal points to possible upside, yet the break out of the bottom of the descending channel dating back to March is highly bearish and points towards a clear upside resistance level. That resistance level coincides with the support level from late last week at 10,060. Thus I expect any upside to meet resistance around 10,000-10,060. Again, I will be watching for any bearish reversal signs. 

Dow selloff expected to continue

The selloff in the Dow Jones has gained some brief respite this morning, yet given the trend in place, it is clear that further losses could be in sight. A very similar story to the DAX and FTSE, where I am watching for a bearish reversal sign from the current flag formation. The safest of which would be a move below the 16,000 low. The first major support level in sight would come in around 15,848 (October low).

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.