FTSE 100, DAX 40 and S&P 500 on back foot after strong July rally
Outlook on FTSE 100, DAX 40 and S&P 500 as US equity indices continue to lead the way higher.
FTSE 100 gunning for the 7500 region
Last week the FTSE 100 finally broke through its key 7,349 to 7,376 resistance area on a daily chart closing basis on easing Federal Reserve (Fed) hike bets.
This resistance area which consists of the late June and 20 July high as well as the 200-day simple moving average (SMA) is now expected to act as support.
Thursday’s rise and daily close above 7,376 confirmed a double bottom with an upside target coming in around this year’s highs at 7,621 to 7,688 but first the 1 June low at 7,518 needs to be overcome.
Below 7,349 lies last Thursday’s low at 7,309. The index remains technically bullish while it stays above this level on a daily chart closing basis.
DAX rally nears the mid-June high at 13,676
The DAX 40 slid back to its 13,447 July high on weaker than expected German retail sales which tumbled to 1.6% month-on-month (MoM) in June versus a revised 1.2% in May and compared to a market forecast of an 0.2% increase before stabilising.
Further minor support can be seen along the one-month support line at 13,220 and more important support at the 13,030 late July low.
Provided that it underpins, the mid-June high at 13,676 and also the mid-May low at 13,685 continue to be in focus. If exceeded, a medium-term bullish reversal could lead to a several week-long rally taking the DAX 40 back towards its March-to-June highs at 14,712 to 14,927.
Support below last Tuesday’s low at 13,030 can be found at the 8 July high at 13,021 and also at the 19 July low at 12,823.
S&P 500 rally nears the May to June highs at 4,189 to 4,203
Late last week the S&P 500 accelerated to the upside, helped by Federal Reserve chair, Jerome Powell’s comments that slowing the pace of rate hikes whilst keeping a close eye on inflation and the economy might be appropriate and 78% of S&P 500 earnings so far beating expectations.
The index rose by close to 8% in July, its best performance in years, and is seen heading towards the May to June highs at 4,189 to 4,203 which are likely to offer resistance. at least in the short-term.
Minor support can be spotted at the early June lows at 4,077 to 4,074 and further potential support at the 22 July high at 4,012.
The information 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 Bank S.A. 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 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. See full non-independent research disclaimer.
Seize your opportunity
Deal on the world’s stock indices today.
- Trade on rising or falling markets
- Get one-point spreads on the FTSE 100, 1.2 on the Germany 40, and 0.4 on the US 500
- Unrivalled 24-hour pricing
See opportunity on an index?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Try a risk-free trade
- See whether your hunch pays off
See opportunity on an index?
Don’t miss your chance – upgrade to a live account to take advantage.
- Get spreads from one point on the FTSE 100, 1.2 on the Germany 40, and 0.4 on the US 500
- Trade more 24-hour indices than any other provider
- Analyse and deal seamlessly on smart, fast charts
See opportunity on an index?
Don’t miss your chance. Log in to take your position.
Live prices on most popular markets
- Forex
- Shares
- Indices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
