Levels to watch: FTSE, DAX and Dow

Monday has seen some modest selling so far, but the prospect of European Central Bank action later this week is likely to provide support for further bullish momentum. 

A man looking at data
Source: Bloomberg

FTSE outlook less positive

The failure to push on past 6400 makes the outlook less optimistic for the time being. With the index testing the lows of Friday’s session around 6348, a move to 6320 would suggest that the upward move has come to an end. Downside targets would then lie around 6280 and onwards to 6220. Unless the sharp drop early on today is reversed we may see bearish momentum build. It would take a move through 6400 to reverse the outlook.

DAX fails to break 11,350

Two days of trying to break through 11,350 have ended with another drop, although Friday’s lows around 11,240 may hold. A move through here heads towards support at 11,130, and then down towards 10,900. The daily uptrend from the September lows still holds, and so even a move to 10,830 would still not count as particularly bearish. A break through 11,350 would head towards resistance at 11,464, and then on towards the August highs around 11,600.

Dow starts week off poorly

The week has opened with a negative start for US futures, after the quiet end to last week. We saw repeated attempts to move beyond 17,900 over the last few sessions, all of which came to naught. For now support around 17,750 continues to hold, but a move down through here would head towards 17,620, and then on to the 200-day SMA around 17,420. A bullish move needs to break beyond 18,000 to really indicate that the index is moving higher, rather than just consolidating. 

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.