Levels to watch: FTSE 100, DAX and Dow

A mixed outlook points to a non-cohesive market sentiment across the board, with a bearish FTSE 100 breakdown coming amid a rebound for the DAX and Dow.

FTSE 100 breaking lower from rising wedge

The FTSE 100 is turning lower at the open this morning, with the overnight rise forming a bearish rising wedge formation.

That points towards a likely continuation of the recent losses, with a strong possibility that the index will return to the lower end of the range in play over the past two months. With that in mind, watch for a potential downward extension, with 7614 the next support level of note. A break above 7673 would be required to negate this short-term bearish outlook.

DAX rebounding from confluence of support

The DAX is rebounding from a key confluence of support, with the price rising after moving within touching distance of trendline and 76.4% Fibonacci support yesterday.

This comes off the back of a sharp sell-off following the completion of a head and shoulders pattern. Given the shallow nature of this rebound, there is a good chance we will see further upside for the near term, even if we are looking at a retracement.

Dow attempting to regain ground after recent decline

The Dow Jones is moving higher following a strong sell-off over the past week.

Crucially we have not broken the 25,114 level, below which we would be looking at a wider bearish shift for the index. Until that happens, there is a good chance we could turn higher from here, with an hourly close above 25,378 pointing towards a period of upside. Conversely, an hourly close below 25,114 would signal a likely breakdown from here.

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.