FTSE 100, DAX and Dow retraces after recent surge
FTSE 100, DAX and Dow ease back after recent surge, yet bullish outlook remains in tact.
FTSE 100 rally starts to ease after rise through 6264
The FTSE 100 saw a strong start to the week yesterday, with the stock finally managing to break through the 6264 resistance level to bring about a two-week high. The break through resistance also appears to signal a bullish exit from a symmetrical triangle formation that has been in play over the course of June.
With that in mind, further upside looks likely, where the current pullback is expected to provide a retracement of the rally from 6135. As such, a bullish outlook is in place, with a break below 6135 required to negate this view. Watch out for Fibonacci support around 6206 and 6179 to provide a potential bullish reversal area if we see further short-term downside.
DAX eases back, but uptrend remains intact
The DAX has seen some downside today, following yesterday's rebound into the highest level in almost a month. That rally served to continue the intraday uptrend in place since late June, with higher highs and lows still in play unless we see a break below the 12,473 level.
Until then another move higher looks likely for the index. If we do see another push higher from here, the ultimate break through 12,939 is important in establishing a new wider bullish continuation signal for the index. Bear in mind that if we did see a decline through 12,473 support, it would simply look to bring a wider retracement of the rally from 11,955 into play.
Dow Jones turns lower from trendline resistance
The Dow is similarly easing back, following a rally into trendline resistance overnight. This looks largely like a retracement and precursor to further upside, with a break below the 25,564 level required to negate some of that bullish sentiment.
That overnight rally also took the index into the 26,423 level, which means we are now seeing flatlining highs rather than the lower highs that have been in play over the past month. As such, the current weakness we are seeing looks like a potential buying opportunity until the index drops below 25,564.
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