Levels to watch: FTSE 100, DAX and Dow

Bullish breaks for the indices see the Dow hit record highs. However, with the DAX and FTSE 100 at key resistance levels, another surge is required.

FTSE 100 breaks back towards record highs

The FTSE 100 has managed to recover much of the ground lost earlier in the week, with the price moving towards the 7705 record highs overnight.

That level will dictate the state of play for the day, with an hourly close above 7705 pointing towards another surge higher from here. As such, watch for how the index responds to that area of resistance, as a gauge of where the index will go next.

DAX rallies into notable resistance level

The DAX has also regained ground following early weakness this week, with yesterday’s break above the 12,948 resistance level providing another leg higher.

This has taken us into the 13,133 resistance level, which will dictate the price action going forward. Should the price break above that resistance level and post an hourly close, it would point towards further upside to come. Alternately, with the price overbought on the stochastic, and trading below 13,133, there is always a chance of a retracement, as long as we remain below resistance.

Dow punches through resistance

The Dow Jones has broken to new record highs, with the price finally rallying out of its sideways consolidation phase. That previous high of 24,875-24,899 could become newfound support, should the price retrace in the near future.

However, this breakout looks to be the next leg higher in a long-term uptrend for the Dow. We would need a break below 24,688 to negate this bullish outlook.

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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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