Levels to watch: FTSE 100, DAX and S&P 500
The mid-May pullback seems to have run its course, as indices continue to recover from their lows with a series of higher highs and higher lows.
FTSE 100 builds new uptrend
FTSE 100 has created two higher highs since the rebound began earlier in the week, with higher lows in place as well.
With the recovery now in place, we look for further gains above 7350, and then on to 7400, 7450 and then potentially back to the April high at 7530. A more bearish view would require a move back below 7140.
DAX soars on renewed risk appetite
DAX has leapt higher over the past two days, putting it back above the 12,200 swing-high from last week.
A pullback overnight is hardly surprising, and welcome from a bullish perspective – further gains target 12,400 and 12,450. The bearish view would require a move back below 12,000.
S&P 500 continues its steady gains
The rebound here has seen the S&P 500 move back to the 2890-2900 zone that marked the peak last week.
An overnight pullback provides another potential buying opportunity, targeting 2890 and then on to 2930. A failure to hold the overnight lows around 2865 would target 2830 and then 2800.
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