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

Indices have continued Friday’s bounce into the new week, but for the DAX the outlook remains bleak.

German stock exchange trader
Source: Bloomberg

A good start to the week for FTSE 100

Friday’s dip below 7360 was met by buying, and further momentum this morning has lifted the FTSE back above 7400. Last week saw price action falter at the descending trendline off the June high, so we would need to see a close above 7460 to break this. From there a move to 7500 and higher comes into view.

A close below 7360 would be a bearish development, although it would require a firm drop below the 7300 area to really indicate more weakness is ahead.

DAX between a bounce a new lower low

The DAX finished the week on a poor note, touching its lowest level since mid-April. A key point of interest last week was provided at 12,180, with dips below this area finding buyers.

The creation of a new lower low would certainly suggest that the bears still have the upper hand, as they have since early June. A bounce would target 12,310 in the short term, followed by the descending trendline off the June highs. 

S&P 500 on a high

A fresh record high for S&P 500 last week and a stronger finish to the session on Friday sets us up for a good start to the new week today, and the new month tomorrow.

Last week’s 2483 high is the only point of resistance, while support on the daily chart could come into play around 2454. Intraday, 2465 was the area that prevented further downside last week, so this is the immediate area to watch.

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This information has been prepared by IG, a trading name of IG Markets Limited and IG Markets South Africa 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. International accounts are offered by IG Markets Limited in the UK (FCA Number 195355), a juristic representative of IG Markets South Africa Limited (FSP No 41393). South African residents are required to obtain the necessary tax clearance certificates in line with their foreign investment allowance and may not use credit or debit cards to fund their international account.

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