Levels to watch: FTSE 100, DAX and S&P 500

Indices are aiming to rebound after heavy losses yesterday, but the outlook seems doubtful for the FTSE 100 and the DAX. 

Market data
Source: Bloomberg

FTSE 100 – will the 7300 zone hold?

The FTSE 100 balance looks to be swinging back to the bears, with the close back below 7360 yesterday. Bulls must once again hope that the 7300 zone holds, as it has done since late June, otherwise we could see a drop to 7260 or lower over the coming weeks.

Any recovery requires a close back above 7360 and then above 7450. 

DAX struggling to break through 12,180

Twice so far this month the DAX has tried to break 12,180, with yesterday’s rally marking the second attempt. So far there has been no joy for the bulls. The Monday support of 12,032 continues to hold however, so sellers need to break this to open the way to the July lows below 11,900.

Any rally must clear 12,180 to then raise the prospect of more sustained upside, although even then the price needs to reclaim 12,250 to end the downtrend that has prevailed so far in August.

S&P 500 up to the buyers to push the move further

Yet again buyers stepped in to take the S&P 500 off its lows, so now it is up to the buyers to push the move further and take out the 2480 peak from last Friday.

Otherwise any close below this maintains the new short-term downtrend off the August highs. A turn lower targets 2447 and then 2420. 

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