FTSE 100, DAX and Dow push back towards previous highs
FTSE 100, DAX and Dow Jones turn higher once more, yet key resistance lies ahead.
FTSE 100 on the rise after recent retracement
The FTSE 100 has been turning higher after a decline into the 76.4% Fibonacci retracement level on Friday.
The failure to break below 7397 points towards a potential continuation of this short-term intraday uptrend that has been in place since the 7231 lows on 31 January. A break through the 7538 level would confirm the continuation of that trend, pointing towards a push back towards the upper echelons of a wider symmetrical triangle formation. That trendline resistance is currently around the 7650 mark. A break below 7397 would be required to negate this bullish short-term picture.
DAX rallies back into resistance zone
The DAX has also regained ground overnight, with the index hitting Thursdays high of 13,602. That level represents the prior record high, and thus provides us with a notable point of resistance.
We also have a rough trendline resistance up ahead, and thus traders should be wary of taking on any long positions at this moment. With price pausing at this key level, we are at a crossroads, where a break through major resistance is required to avoid turning lower yet again. With that in mind, it appears likely we will retrace from here, if only for the short-term. Such a pullback would require a break below 13,425 to bring about a wider bearish picture. However, whether we see that short-term pullback or not, at some point we need to either breakthrough this resistance zone or start to reverse those recent gains.
Dow Jones rallies towards prior peak
The Dow is also regaining ground following a mid-sized retracement last week. The index failed to provide a deep or shallow pullback which would have allowed for a better long entry opportunity.
Therefore, it makes sense to await a break through 29,530 to confirm the continuation of this uptrend. Until then there is a still the possibility of another leg lower to form a deeper pullback.
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