All trading involves risk. Losses can exceed deposits.

Levels to watch: FTSE, DAX and Dow

Indices continue to claw back losses, bouncing off key support after days of heavy losses.

All trading involves risk. Losses can exceed deposits.
Data chart
Source: Bloomberg

FTSE 100 finally bounces
A bounce is finally being seen in London this morning, although it is small beer compared to the losses of the last four sessions. The market held above 5850 and has pushed on above 5900, confirming that the support zone of the August, September and December lows is still intact.

A look at the hourly chart shows the index could go all the way back to 6100 and still be constrained by the descending trendline off the late December highs. Nonetheless, a failure to hold above 6050 would suggest that the sellers are still in the driving seat.

FTSE 100

DAX looks upwards
The index is challenging the highs of yesterday’s session just below 10,040, with a move above here pushing towards 10,109 and then 10,383.

So long as it holds below 10,200, it would seem the downtrend is intact. A push above 10,300 would suggest a bounce is in progress, while a drop through 9800 would certainly point to a test of the lows of September in the direction of 9500.

DAX

Dow could turn lower once more
Yesterday we saw 16,500 acting as strong support, stemming further losses, with futures pushing onwards. The first area to watch is 16,800, the highs of yesterday’s session, but it will take a move through 17,000 to suggest the opening pullback of 2016 is done.

A failure to push on towards this point, or even towards 16,900 points towards a turn lower and a fresh test of 16,500. If this is broken we look towards 16,142 and then 16,000. 

Dow Jones

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.