FTSE 100, DAX and Dow turn lower after yesterday’s gains
FTSE 100, DAX and Dow fall back, but major support levels remain if we are to see this turn into a wider period of declines.
FTSE 100 eases back at the open
The FTSE 100 has dropped back int 6449 support at the open this morning, with the index dropping below trendline support. Whether that is of any significance remains to be seen, with a decline through the 6422 level required to provide a clearer bearish short-term picture.
The uptrend remains in play until that happens, with the stretched stochastic pointing towards a potential upside move in the absence of a break below horizontal support. A break up from oversold would be the bullish signal we would want to see. Alternatively, a break below 6422 brings a more confident bearish outlook.
DAX breaks below trendline support
The DAX has also broken below trendline support in early trade, with the stock seemingly moving within a retracement phase. Given the clear uptrend in play, this pullback is unlikely to persist for too long, with a drop below 12,673 required to bring a more protracted bearish move into play.
Until then, there is a good chance that any further downside is a short-term retracement of the rally from 12,673. As such, these losses are only likely to gather momentum if 12,673 is broken.
Dow Jones consolidates after yesterday's gains
The Dow Jones is falling back into the 27,481 support level, following overnight consolidation at three-month highs. With the index dropping below the 27,481 support level, it looks likely we will see further short-term downside.
However, we will ultimately need to see a break below 27,045 to bring about a true bearish signal into play. Until then, a short-term period of downside could come into play as we retrace the rally from 27,045.
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