FTSE 100, DAX and Dow continue to gain ground
FTSE 100, DAX and Dow continue to gain ground, but questions remain over the longevity of those moves.
FTSE 100 rallies back into key resistance
The FTSE 100 has once again rallied into the key 5975 resistance level, as the pair continues to attempt a break from the recent range. That consolidation remains the dominant force that could ensure another move lower over the short-term. The reaction to this level is going to be key in determining how the day ahead works out. However, while a break through 5975 would likely bring further short-term gains, we would need to see the 6127 level broken to truly exit the long-term downtrend that has been in place since the June peak. Until then, the current rise looks likely to be a retracement before we head lower once again.
DAX rallies into confluence of trendline and Fibonacci resistance
The Germany 40 has been on the rise over the course of the week, with the index currently back into trendline and 61.8% Fibonacci resistance. Whether this is a retracement or not remains to be seen, but from a wider perspective, it seems more likely that this is a continuation move that will ultimately take us up through the 13461 peak. However, for now we have this area to contend with in a bid to continue the recent rise. A break below the 12759 level would be needed to break us from this current bullish trend.
Dow Jones surges but could soon be due a pullback
The Dow has been trending higher over the course of the past fortnight, with the index rising towards the 76.4% Fibonacci resistance level (28569). The index has a clear trend of higher highs and lows, with the stochastic providing good indications of when those pullbacks will occur. The past three retracements have come off the back of a bearish cross in the stochastic and signal line, as highlighted on the chart. With the index heading for a similar crossover, there is a good chance we will see another short-term pullback come into play. However, that may provide us with another buying opportunity, with a bullish trend in play until we break below the prior low (currently 27653).
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