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Levels to watch: FTSE, DAX and Dow

The indices are on the charge higher, with the Dow hitting new highs and the FTSE rallying heavily. Could this move continue apace?

IG Analyst

Publication date : 2017-07-26T09:27:17+0100

US traders

Source: Bloomberg

FTSE punching higher once more

The FTSE is pushing in towards the 76.4% retracement this morning, with the index continuing its recovery following a drop into the 7356 support level on Monday.

The reaction to the 76.4% is going to be key here, with a confident break through it pointing towards a continued resurgence through 7516. However, given the recent flatlining lows, there is also a potential for a more bearish picture to come into play should that Fibonacci resistance be respected.

FTSE chart

FTSE chart

FTSE chart

DAX rallies into key resistance

The DAX is rallying within a rising wedge pattern. The push higher within this bearish pattern points towards a potential weakening in the near future, with the 12,310 level the prime candidate for such a move to come into play.

Given the wider uptrend in play and recent 76.4% respect, there is a good chance that any such weakness could be fleeting. Keep an eye on how the market responds to the 12,310 level, with a break through pointing towards further gains as we approach the wedge apex.

DAX chart

DAX chart

DAX chart

Dow likely to push higher once more

The Dow Jones managed to push higher to new all-time highs yesterday, following a retracement into the 76.4% Fibonacci level. We are now seeing a rally out of a symmetrical triangle, with an hourly close above 21,627 providing confirmation of a likely charge onwards towards the previous highs once more.

A break back below 21,598 would negate this short-term bullish outlook.

Dow Jones chart

Dow Jones chart

Dow Jones chart

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