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Levels to watch: FTSE 100, DAX and Dow

The indices are pushing sharply higher after yesterday’s ECB meeting. However, with the FTSE 100 remaining within a clear reversal pattern, could we see that market diverge from the likes of the DAX and Dow?

IG Analyst

Publication date : 2017-10-27T10:05:41+0100

Market data

Source: Bloomberg

Will FTSE 100 turn lower despite recent rebound?

The FTSE 100 has punched higher in the second half of the week, coming off the back of what looks like a clear top for this market. The break below 7485 provides a clear bearish bias, which holds unless the price breaks above 7528.

That being said, with the price pushing through resistance, and the other indices looking particularly bullish, there is a reason to be less convinced than if we were looking at this market in isolation.

FTSE 100 chart

FTSE 100 chart

FTSE 100 chart

DAX punches into new territory

Yesterday’s European Central Bank (ECB) meeting helped push the DAX higher, with the index reaching record highs yet again this morning. As long as the euro continues to fall, this index is likely to rise.

With that in mind, further upside looks likely for now, with this morning’s swing low of 13,172 being utilized as a level which has to hold for the trend to remain.

DAX chart

DAX chart

DAX chart

Dow rallies into trendline resistance

The Dow Jones is also pushing higher, with the price rising into trendline resistance this morning. The recent break below 23,264 provided a question mark over the longevity of this uptrend.

However, we look likely to push through to new highs yet again given the continued creation of higher highs and higher lows since. As such, a bullish view is in place unless we see a break back below 23,368 support.

Dow Jones chart

Dow Jones chart

Dow Jones chart

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