Levels to watch: FTSE 100, DAX and Dow

The FTSE 100 is leading the losses, with the DAX and Dow consolidating after recent gains.

FTSE 100 looks set for further losses

The FTSE 100 has sold off sharply following the GBP rally yesterday, with the index dropping below the crucial 7520 mark this morning.

That brings us into a more bearish territory once again, following on from the retracement into the 200-day simple moving average (SMA). With that in mind, watch for further downside from here, with rallies being sold into.

DAX continues to consolidate at Fibonacci resistance

The DAX has been consolidating after rallying into the 61.8% retracement. There is a good chance that we will see the index start to weaken today, with a break below 12,493 providing a bearish signal for the near term.

A break back up through Tuesday’s high of 12,600 would point towards a rally into 76.4%, while a drop below 12,493 would signal a more bearish shift.

Dow consolidates after recent rally

The Dow Jones has slowed in its ascent, following a boost earlier in the week thanks to the trade deal with Mexico. This consolidation does raise the chance of a retracement of the rally from 25,606.

Watch for a fall below 26,032 as a signal of such impending price action. Until then, there is a chance we could break higher once more, with the wider bullish outlook remaining in play irrespective of whether we see a short-term pullback or not. 

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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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