CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

Levels to watch: FTSE, DAX and Dow

European and US indices have been moving lower in recent days, yet with clear uptrend in place, this could provide a buying opportunity.

anonymous

Publication date : 2017-06-22T10:20:55+0100

Chart

Source: Bloomberg

FTSE falls back into 76.4%

The FTSE managed to rally from the 76.4% Fibonacci retracement yesterday. However, on the hourly chart it is clear that we have still been creating lower highs, and this has come back to haunt the FTSE, with trendline resistance holding once more to drag the market lower at the open.

With the price having dropped below yesterday’s low, the short-term downtrend remains in place. However, until we see a break below the 7377 mark, this still looks like we could reverse higher given the wider uptrend and this week’s break through 7552.

FTSE chart

FTSE chart

FTSE chart

DAX approaches key Fibonacci support

The DAX looks to be heading lower this morning, following a period of consolidation overnight. However, there is reason to believe that this weakness will be shortlived, given the push through 12,923 on Tuesday.

However, with the price having broken to a lower low before that, there is a somewhat mixed picture in play here. Nevertheless, with the wider uptrend, coupled with the fact that you can get a good risk to reward, it makes sense to look for longs around the 76.4% level (12696). A break below 12,617 would negate this.

DAX chart

DAX chart

DAX chart

Dow hits trendline support

The Dow Jones has pulled back from its uptrend this week, with the price having moved into trendline support overnight. There is no doubt that we are looking at a highly trending market, and as such the expectation is for that trend to continue. For that to occur, we would need another move higher rather than a break below 21,306.

Whether this trendline holds or not remains to be seen, yet with the 61.8% retracement also joining the trendline, this looks like an interesting area for longs.

Dow Jones chart

Dow Jones chart

Dow Jones chart

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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.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. Clients can lose more than they deposit. All trading involves risk.

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