Levels to watch: FTSE, DAX and S&P 500

Despite an all-time high for the DAX yesterday, it looks like bullish momentum is becoming hard to sustain.

index figure
Source: Bloomberg

FTSE 100 pushing lower for now

A bounce above 7260 yesterday was defeated, with this previous support level now acting as resistance. Last week, the FTSE 100 bounced at 7192, so this is the area to look for support in case of further losses today. Below this, 7090 comes into play.

A break through the 7260-7280 zone is needed in the first instance for a bullish move, and then on through the late April high at 7300. 

DAX bullish sentiment in check

A new all-time high yesterday for the DAX came as European assets rallied across the board. Pullbacks from the current level would suggest a drop back to 12,400 in the short term, and then down to 12,179 and 12,124.

The French elections may well keep bullish sentiment in check, and given the magnitude of the rally yesterday we may see markets struggle for direction even if, as expected, Emmanuel Macron takes the crown on Sunday.

S&P 500 stuck in consolidation mode for now

The drift goes on for the S&P 500, with an attempt to push high fizzling out yesterday, and then an afternoon slump also swiftly reversed. The range 2378-2400 continues to hold, so until this is broken we are stuck in consolidation mode.

Momentum has shifted to the negative, with the advance-decline line (the number of rising stocks versus the number of falling ones) having declined steadily over the past few days. Crucially, on a weekly view, this measure has dropped below its 50-period moving average for the first time since February 2016.

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