Levels to watch: FTSE 100, DAX and Dow

European and US markets have been drifting lower at the start of the week, with questions arising over whether this is a retracement or a reversal.

FTSE 100 drifts lower from Fibonacci resistance

The FTSE 100 has been moving lower after hitting the 76.4% resistance level which capped the price action just over a week ago.The gradual nature of this move points towards a potential retracement in play here, with a break below 6798 required to bring about a wider bearish outlook.

However, while another move lower looks likely over the short term, we need to see a break through the 6983 swing high to point towards a potential rally through that 7000 mark and onwards.

DAX weakening after recent rally

The DAX saw a similar surge into the 76.4% retracement, with the index turning lower in response. The uptrend seen throughout 2019 thus far points towards this current move lower forming a retracement before we move higher once more.

However, the wider bearish trend still holds, with the respect of the 76.4% retracement highlighting the possibility that markets see value in that wider trend. As such, we should watch to see if we can maintain this bearish price action below the 76.4% resistance level, with a break above there pointing towards a potential move into the crucial 11,570 breakout level.

Dow hesitation could provide bullish set-up

The Dow Jones has been drifting lower overnight, coming off the back of a recent rally for the index.

The uptrend remains intact unless we see the price break below 23,726, and thus there could be another leg higher before long. The key to such a move higher would be a rally through the 24,668 resistance level. Until then, there is still a chance for the index to drift lower over the short term.

IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.

Please see important Research Disclaimer.

See an opportunity to trade?

Go long or short on more than 17,000 markets with IG.

Trade CFDs on our award-winning platform, with low spreads on indices, shares, commodities and more.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices
Sell
Buy
Updated
Change
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Sell
Buy
Updated
Change

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

Sell
Buy
Updated
Change
-
-
-
-
-
-
-
-
-
-
-
-
China 300
-
-
-
-

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.

The Momentum Report

Get the week’s momentum report sent directly to your inbox every Monday for FREE. The Week Ahead gives you a full calendar of upcoming key events to monitor in the coming week, as well as commentary and insight from our expert analysts on the major indices to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.