FTSE seeing double-bottom
We are now seeing a double-bottom take shape in the FTSE, with the 6641 level acting as a near-term resistance that has already been tested today. A break and close through here could result in a textbook reversal towards the 6780 level in the next few weeks.
For now I’d like to see price action break through the 6641 level (on a daily close), 6680 and the 50-DMA challenged if this move is to unfold.
The 6620 level and 200-DMA at 6591-6600 should act as a buffer to downside now.
DAX could see profit-taking
The DAX has also seen a break higher through 9365 and the 100-DMA, and now seeks to push with a concerted effort through the 9450-60 marker and the 61.8% Fibonacci from the highs of 21 January to the recent lows of 17 March. There is a degree of trendline resistance here from the 9700 highs, so a daily close through here should quickly bring the 9500-05 region into view.
The relative strength index on the one-hour chart is looking slightly overbought, so we could see some consolidation and indeed profit-taking prior to another move up. The 9420 level should provide support, then 9375.
Dow maintains its uptrend
The Dow Jones, having finally shaken the restraints of the 16,300 level, maintains its uptrend and (at time of writing) is trading at 16,430. There is trendline resistance from the late December highs coming in at the juncture, so I’d like to see the 16,460 area succumb if we are to make a move back towards the 16,515 level and the early March highs.
The one-hour RSI is overbought, so pullbacks to 16,400 cannot be ruled out in the intraday; the 16,370 level lies below this.