FTSE 100, DAX and Dow drift lower after sharp global market gains
FTSE 100, DAX and Dow start to ease back following yesterday’s sharp surge for global markets.
FTSE 100 rallies into key resistance level
The FTSE 100 has been surging higher at the start of this week, with the improved US-China trade picture paving the way for gains globally. However, we have now seen the index rally into key historical resistance, with the late-April high of 7528 providing a key hurdle to overcome today.
The ability or inability to break that level would be crucial in determining where we go from here. Should we fail to break through 7528, we would need to see a move below 7487 to bring about a bearish short-term picture.
DAX easing back after Monday surge
The DAX joined the rest of the stock markets with a gap higher at the start of the week, yet we are starting to see the sellers coming into play as the index starts to form a consolidation or retracement phase.
The depth of such a pullback is unknown, yet it is likely that such a move is short term rather than the beginning of a complete reversal. Thus, we could see further downside for the short term, yet a wider bullish outlook remains unless we see a break below 12,169.
Dow turns lower from record highs
The Dow Jones attempted to break into a record higher yesterday, yet the index failed to break through the 26,951 level and is now drifting lower.
The bullish falling wedge pattern breakout took us within striking distance of that new high, yet there is a growing possibility that the index will form a bearish reversal signal if we break below 26,433. For the moment, it makes sense to await a break through either 26,951 or 26,433 to provide a signal of where we go from here.
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