SP500, DAX40 and FTSE100 price forecasts: 29 June 2023

SP500 (US 500) – short term resumption of longer-term uptrend

The short-term correction of the longer-term uptrend on the SP500 index looks to have ended with a bullish candlestick reversal (bullish engulfing). This suggests that the short-term trend is now aligning with the longer-term uptrend.

The recent high at 4450 becomes the initial upside resistance target from the move. Traders who are long might consider using a close below the reversal low at 4330 or horizontal support at 4300 (depending on threshold for risk) as a stop loss indication for the trade.

DAX40 (Germany 40) – bullish reversal off range support

The long-term trend for the DAX40 remains up, as we see the price still trading firmly above the 200-day simple moving average (200MA) (blue line) on the chart above. In the short to medium term, the price trades within a sideways range between levels 15715 (support) and 16330 (resistance).

The long-term trend suggests keeping a long bias to trades on the index. The bullish price reversal off range support at 15715 targets a move back towards range resistance at 16330. Traders who are long might consider using a close below the 15715 level as a stop loss indication for the trade.

FTSE100 – sideways grind persists

The price of the FTSE 100 whipsawing back and forth through the 200MA suggests the index to be in a broad sideways trend for the time being. This type of environment suggests trading between levels rather than trend following.

Traders looking for short entry might look for a bearish candlestick pattern / price reversal closer towards the 7560 level to target a move back to support at 7410. In this scenario a close above the reversal high or 7560 level might be used as a stop loss consideration for the trade.

Traders looking for long entry might prefer to instead wait for a break of trend line and horizontal resistance at 7560 before targeting a move back towards the 7650 level.