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

US markets maintain their bullish outlook, but the same cannot be said of the DAX. 

Source: Bloomberg

FTSE 100 eyes 7553

The index continues to defend the 7300 area, but price action over the past few weeks has been indecisive at best. So long as 7300 holds then bulls can contemplate another attempt to push on and take out the falling trendline from the June highs, which has come back into play following the losses last week.

A daily close above last week’s highs of 7553 would indicate a new attempt to break the June all-time high is now in play.

DAX could reach 12,000

A bounce off the 200-day simple moving average (SMA) - 11,970 - last week provided some reason for optimism, but since June the overriding trend here has been to sell the rallies.

12,310 is the next area to watch on the upside for the DAX; having been strong support in June, it became powerful resistance over the past two months. If the rally falters here, then the still-intact descending trendline from the June high will remain as the guiding element here — a drop back to 12,000 and lower would then become highly likely. 

S&P 500 could see further rallies

Yet again the index’s stay below the 50-day SMA (2449) was brief, mirroring similar dips in the first half of the year. A further rally looks likely, with the 8 August high at 2491 now the target to beat to create a new all-time high.

The continuation of higher lows on the daily chart shows that this uptrend has not come under threat just yet. 

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