CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your deposits, so please ensure that you fully understand the risks involved. CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your deposits, so please ensure that you fully understand the risks involved.

Levels to watch: FTSE 100, DAX and Dow

The indices are consolidating following their recent rebounds. However, with the Dow showing signs of potential weakness, could we see another pullback in the near term?

IG Analyst

Publication date : 2018-02-08T09:32:17+0000

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FTSE 100 turning higher within gradual ascent

After setting another deep retracement overnight, the FTSE 100 is moving higher.

The index has been in recovery mode, and as long as the price remains above the 7179 mark, another leg higher looks likely from here. Look out for near-term resistance at 7312.

FTSE 100 chart

FTSE 100 chart

FTSE 100 chart

DAX consolidating after rebound

Off the back of a sharp rebound on Tuesday morning, the DAX has been drifting gradually lower. The shallow nature of this current move points towards a bullish break higher before long.

However, that doesn’t rule out another short-term move lower for a deeper retracement, with trendline resistance coming into play on the stochastic oscillator. Watch for a break above 12,652 as a signal that this current retracement is over.

DAX chart

DAX chart

DAX chart

Dow threatens to post deeper retracement

The price fell marginally below the low set yesterday morning, meaning the Dow Jones failed to maintain the trend of higher highs and higher lows.

The ability to break above 25,298 would signal that this is not something to worry about. However, there is a possibility that this is providing a precursor to another move lower, with a bearish divergence between the price and the stochastic highlighting this. Should that occur, the Fibonacci support levels at 23,947 and 23,628 would come into play as potential buying areas.

Dow Jones chart

Dow Jones chart

Dow Jones chart

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