Levels to watch: FTSE 100, DAX and Dow

The FTSE 100 has moved into a crucial resistance zone, with the DAX also starting to show signs of weakness after yesterday’s surge. Meanwhile, the Dow is starting to look likely to push higher over the near term.

FTSE 100 ascendancy hits Fibonacci resistance

The FTSE 100 has continued it’s ascent throughout the week, with the price gradually rising despite recent deep retracements.

With the price having hit the long-term 76.4% retracement (drawn from 7796-6841), alongside a historical zone of resistance, there is a good chance we could see a move lower from here. A break below 7500 would be required to negate the current downtrend. Until then, the creation of higher highs and lows remains in play.

DAX surge could bring near term retracement

The DAX managed to outperform yesterday, with the index gaining 1.3% in the space of an hour.

However, with such a surge comes the chance of a pullback to retrace some of the move. With the price failing to create a new high this morning, a break and hourly close below 12,747 would provide a bearish near-term signal. Such a signal would only provide a short-term retracement outlook, with a Fibonacci drawn from 12,499 to 12,830 coming into play. However, as long as the price remains above 12,747, the potential for another break higher is still relevant.

Dow begins to turn higher once more

The Dow Jones is turning higher this morning after the recent decline towards the crucial 23,804-23,822 support zone.

The failure to break into that zone could be telling as a bullish signal. However, we would ultimately need a break through 24,189 to provide a wider bullish view. Until then, there is a good chance that we will see a rally, if only to retrace part of the 24,189-23,846 decline. Conversely, a break below 23,802 would provide a bearish continuation signal. 

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