Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 70% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.

Levels to watch: FTSE 100, DAX and Dow

A rebound for European and US stock markets has brought relief within a recent downtrend. However, with the DAX and Dow downtrends remaining intact, the sell-off may not be over yet.

FTSE 100 rises through resistance

FTSE 100 has been gaining ground this week, with the index passing through a crucial resistance point to bring about a more bullish outlook going forward. The rise through 7286 signals an end to the trend of lower highs that has been in play over the course of the past three weeks, raising the likeliness of a long-lasting recovery for the index.

With that in mind, further gains remain a distinct possibility, with a drop below 7222 required to negate this short-term ascendance. However, it is worth noting that the decline of the pound has been a key driver of the FTSE 100 outperformance, with the bearish picture for the DAX and Dow Jones highlighting that we are not out of the woods yet for the overall stock market outlook.

DAX rebounds into 76.4% resistance

DAX has also gained ground following a rally from key swing low support at 11,824. The trend of lower highs remains in tact for now, with the price having moved into the 76.4% Fibonacci resistance level at 12,118.

A break through the 12,212 swing high would negate the bearish trend and it is worthwhile looking out for whether we reverse lower or push through this resistance point as a determinant of forthcoming price action. Given the bearish shift in momentum as seen through the stochastic oscillator, it makes sense to watch out for downside for the near term.

Dow turning lower from 61.8% retracement

Dow Jones is another market which has been showing weakness at a key resistance level, with the index turning lower from the 61.8% Fibonacci level overnight.

The wider bearish trend remains intact for now, with a break through 26,019 required to bring about a more bullish view. For the short term, further downside looks likely with the oversold stochastic highlighting the potential for a bearish turn from here.

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.

Seize your opportunity

Deal on the world’s stock indices today.

  • Trade on rising or falling markets
  • Get one-point spreads on the FTSE 100
  • Unrivalled 24-hour pricing

See opportunity on an index?

Try a risk-free trade in your demo account, and see whether you’re on to something.

  • Log in to your demo
  • Try a risk-free trade
  • See whether your hunch pays off

See opportunity on an index?

Don’t miss your chance – upgrade to a live account to take advantage.

  • Get spreads from one point on the FTSE 100
  • Trade more 24-hour indices than any other provider
  • Analyse and deal seamlessly on smart, fast charts

See opportunity on an index?

Don’t miss your chance. Log in to take your position.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

Plan your trading week

Get the week’s market-moving news sent directly to your inbox every Sunday. The Week Ahead gives you a full calendar of upcoming economic events, as well as commentary from our expert analysts on the key markets to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of spread betting and CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.