Levels to watch: FTSE, DAX and Dow

With NFPs looming, price action remains rangebound, although it remains clear that the bounce from earlier in the week has been unable to gain momentum. 

German stock market
Source: Bloomberg

FTSE 100 could drop to 5600

A choppy day yesterday saw the index move in a range of about 100 points. So far today any attempt to get to 5950, the top end of this area, has been defeated, with 5900 acting as a magnet.

A break above 5950 would be regarded a bullish, although 6000 is still active as resistance, while a move below 6850 would head towards Tuesday’s lows around 5800.

Any sustained action below this area suggests we will see a drop to 5600. 

DAX could return to 9600

Yesterday saw the index test the area around 9300, but sellers were unable to push the market beyond this point.

If this continues to hold then the possibility remains that a return to 9600 is in the offing, as the index looks to build a base around current levels.

A close below 9300 would suggest that the next target is 9210. If the August lows hold and the index moves above 9600, then the next levels to watch become 9775 and then 9930.

Dow could target 50-day SMA

Although the index is off the lows of the week, so far progress above 16,450 is non-existent.

This has been the case all week, so a continued failure to push on would see the downside case come into view, with support around 16,224, 16,075 and then the lows of Tuesday at 15,945.

Below this, the price would head towards the January lows near 15,400. Any bounce needs to clear 16,634 to indicate really bullish momentum, which would allow the index to target the 50-day simple moving average at 16,939. 

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